The development of the Miran and Bina Bawi fields is set to unlock significant value for both Genel and the KRG. There is the potential for early oil at Bina Bawi, and the gas assets can assist the Kurdistan Regional Government in satisfying domestic gas demand and its obligations under the KRG-Turkey Gas Sales Agreement.
The development of the fields is a unique opportunity. The fields are 300 km from Turkey, and they provide Turkey with the opportunity of materially reducing their gas import costs.
Turkey currently consumes approximately 50 bcma of gas, of which more than half is provided by Russia. With the KRG set to provide 20 bcma, this gas will help to diversify, and indeed form the baseload of Turkish supply, at a cheaper price than all current imports.
The project is underpinned by the KRI-Turkey Gas Sales Agreement, and is a world-class resource with a committed government buyer for the gas in place.
In January 2018 Bina Bawi and Miran CPRs confirmed a c.45% uplift to gross 2C raw gas resources to 14.8 Tcf. The upstream part of the project has been materially de-risked, with 1C volumes more than sufficient for the gas volumes required under the gas lifting agreement. Following the CPR, further reservoir engineering has demonstrated the viability of high-rate gas wells, which in turn more than halves the number of wells required to produce the volumes under the gas lifting agreement, materially reducing the overall cost of the project.
Field development plans for both Bina Bawi and Miran oil and gas are under discussion with the KRG, and may entail a phased development approach in order to reduce initial capital expenditure and achieve the earliest date for first gas. An extension to the conditions precedent is expected to be granted shortly.