Genel reached agreement to acquire stakes in the Chevron operated Sarta block, in the Kurdistan Region of Iraq, in January 2019.

Genel acquired 30% equity in the Sarta licence by paying a 50% share of ongoing field development costs until a specific production target is reached, together with a success fee payable on achievement of a production milestone. Chevron retain a 50% interest in the Sarta licence and the Kurdistan Regional Government hold the remaining 20%.

Having completed the transaction in February, the field partners are now progressing with the development of the asset, which will be done in phases.

To date, four exploration wells at Sarta have discovered hydrocarbons at multiple intervals, from the Tertiary down to the Triassic. This contributes to the Company’s unrisked P50 gross resource estimate of c.500 MMbbls. Phase 1A represents a low-cost development of the Jurasssic Mus-Adaiyah reservoirs. This phase is designed to recover 2P gross reserves of 34 MMbbls through two existing wells (Sarta-2 and Sarta-3) both of which flowed at c.7,500 bopd on test, and one additional development well to be drilled in 2021. Insights from production behaviour during this first phase, combined with an appraisal and development well campaign planned for 2021, will provide the technical foundation for prudent expansion investment decisions aimed at maturing Sarta into a low cost, long-life, cash generative asset.

Construction work for the Phase 1A development is well underway. Chevron Sarta, as operator of the Sarta field, signed a contract with OILSERV in August 2019 for the construction, installation, operation and maintenance of a 20,000 bopd central processing facility.

Production is on track to begin in the summer of 2020.