Manisa-Salihli-Durasilli Licences

Context and Introduction

AR / MER / 4639, 4640, 4704 Manisa, Salihli and Durasili exploration Licences (namely called Manisa licences) of Merty are located on the east-west trending assymetric Alaşehir (Gediz) Graben  and  totally covers  1194 sq-km area. Since 2006, in Alaşehir block Merty alone has  implemented  a great amount of   exploration and  development  works  (191.05 -km new 2D, re-processining of 182.8 km older 2D, Gore surveying and  drilling 2 wells and re-entering & testing of various wells) and  established  production facilities  on the Sarıkız-2 discovery well. Along with the Alaşehir  block, Merty has persisted  its exploration  work in the  Manisa blocks (Manisa, Salihli and Durasilli);  available sparce  2D seismic (59 km)  are interpreted and combined with the  geolologic and gravity–magnatic data  (more than  5000  gravity –magnetic  measurements collected  since  1994) to better understand the basin geometry  and configuration. Merty has also integrated well data of Taytan-1 and Soyak-1 (with strong oil shows)  drilled by Geothermal Operators.

Current Status

The Exploration works in the licences  are ongoing. The 2012 work program is as follows:

•280 km Regional 2D Seismic Acquisition
• Geochemical GORE Survey study
• Two Exploration Well Drilling in 2012. The total cost of the planned work  is in the order of 9 MMUSD.

Highlights

Excellent  lacustrine source rock  with great efficiency
High API  oil  (30- 38 API) without any sulfur content
Shallow  multiple reservoirs in  shallow depths (600-2000 m.)
High Porosity (17-25%) and Permeability (0.1-25md)
Diverse traps both structural and combination  type
Easy market access and low cost surface facilities
Established infrastructure with proxy  to pipelines
Ready Sales contract
Brent referenced pricing  mechanism
Quick PB period and high NPV

LICENSE OWNERSHIP

Within the W-E extending Alaşehir  (Gediz) Graben, there are four exploration licence blocks. They are namelly called from west to east Manisa  (AR/MER/4639), Salihli  (AR/MER/4640) and Durasali (AR/MER/4704) (within these  wells  Merty holds 100%) and Alaşehir (AR/PTK-EXT/3846) (Merty 80% and Petrako 20%). The first three  were  awarded to Merty Energy on November 2009 and 2010.

LICENSE TERMS AND HISTORY

 

Turkey has attractive fiscal terms, under a tax royalty system, with a gross royalty of 12.5 percent and corporate tax rate of 20 percent. Each license has a term for four years and is renewable twice for a period of two years per renewal. Exploitation licenses are granted for a period of 20 years, and may be extended twice, each extension maximised to 10 years.

 

Refineries are obliged to purchase any locally produce crude oil at the world market price as per the Law. Current prevailing selling price of 37API crude is averaging 2-3% lower than benchmark IPE Brent price.

 

Onthe other hand the natural gas sales  are regulated  by EMRA (energy market regulatory authority) within the context of Gas market law  and the petroleum law  giving the local production the priority.

Technical

Plio-Miocene graben fill sequence is made up of three tectonostratigraphic packages, These are Lower and Upper  Miocene ,and Pliocene sequences.  Lower  and  Upper Miocene clastics and associated llacustrine shales correspond to early to mid stage of rifting .Fairly coarse clastics of the Pliocene most likely reflects the closing stage in the rift evolution. The Alaşehir graben is well defined with respect to  its existing  hydracarbon system.  Working in-situ hydrocarbon system is Miocene; components of source, reservoir /seal pairs are respectively lacustrine shales or mudstones and fluvial-to- alluvial origin wedge-like coarse to fine clastics enclosed or encompassed with low-energy products of   fine clastics forming intraformational sealing unit. Lower Miocene lacustrine shales are the mature source rocks and often  sssociated  with the lacustrine limestones.

Alaşehir graben, although narrow  and assymetric in N-S direction, and deepens to the east along its axis. Even well data indicate that more than 3000-m-thick Neogene sequence is recently drilled in the Taytan-1 well  in Salihli block 4640 . The entire basin has high heat flow regime: Even a local heat source could generate significant amounts of hydrocarbons from organic – rich lacustrine shales at even relatively shallow depths. Basin analysis indicate that lower part of the Lower Miocene Alaşehir formation  shoud  have started generating hydrocarbon 13.3 million years (Late Miocene) before present time and has still continue to the generation present time.

In the entire blocks of Merty. Trap types are diverse in type, size  and magnitude will be explored in  the roll-over anticlines, alluvial fans associated with block faults and fractured lacustrine limestones  with themost of the  new data to be provided in 2012.

The gas prices developed in the market freeley within the context of competition within the gas wholesales companies and the distribution companies as well as the big consulers which the gas producer has the right to choose  to sell from.

Initial Results

Through the studies performed in Alaşehir, Manisa and regional scale,  the local and overall stratigraphy, source rock characteristics and basin evaluation of the entire blocks are well understood by Merty. The sedimentary units are divided into three sequences.  IGood-quality,  lacustrine-origin  mature source rock exists in the  the Lower to Middle Miocene sequence .They are characterized by high TOC  (1.2 % to 6 % ) , high HI (up to 500) , moderate to high Tmax  (429   to  434)   and  SCI  value ( 3.0 to 4.5) and  I and II Kerosene types.  These  source rocks  are  both interfingered with and  unconformably overlain by coarse grained fan and stream flow deposits good candidiate for  reservoirs with high porosity 25 %  and  good permeability  (0.1 – 10 md).

Basin Modeling  analysis proves that Alaşehir Formation shows convenient maturity values and bruil history at approx 1500m/120 0C to produce good quality oil. On the bases of available data collected and evaluated  so far, Merty is very interested in exploring the area  as well as the area to the aest and will continue exploartion compaign with the additional  to be collected  in 2012.

200 kms 2D seismic and GORE™ Survey exploration works will be done to investigate  the structures and to compare the petroleum potential between the Sarıkız Oil Field and Manisa Concession.