Attached files
| file | filename |
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| 8-K - FORM 8-K - TRANSATLANTIC PETROLEUM LTD. | d8k.htm |
 Permian Basin, TX ‘38
Gas
Flare
Deventci
R-1
well
February, 2011
Bulgaria Overview
Exhibit 99.1 |
   Disclaimer
2
Outlooks, projections, estimates, targets, and business plans in this presentation or any
related subsequent discussions are forward-looking statements. Actual future
results, including TransAtlantic Petroleum Ltd.’s own production growth and mix; financial results; the amount and mix
of capital expenditures; resource additions and recoveries; finding and development costs;
project and drilling plans, timing, costs, and capacities; revenue enhancements and cost
efficiencies; industry margins; margin enhancements and integration benefits; and the impact of technology
could differ materially due to a number of factors. These include changes in long-term oil
or gas prices or other market conditions affecting the oil, gas, and petrochemical
industries; reservoir performance; timely completion of development projects; war and other political or security
disturbances; changes in law or government regulation; the outcome of commercial negotiations;
the actions of competitors; unexpected technological developments; the occurrence and
duration of economic recessions; unforeseen technical difficulties; and other factors discussed
here and under the heading “Risk Factors" in our Annual Report on Form 10-K
for the year ended December 31, 2009 and our Quarterly Reports on Form 10-Qfor the
quarters ended March 31, 2010, June 30, 2010 and September 30, 2010 available at our website at
www.transatlanticpetroleum.com and www.sec.gov. See also TransAtlantic’s 2009
audited financial statements and the accompanying management discussion and analysis.
Forward-looking statements are based on management’s knowledge and reasonable expectations on the
date hereof, and we assume no duty to update these statements as of any future date.
The information set forth in this presentation does not constitute an offer, solicitation or
recommendation to sell or an offer to buy any securities of the Company. The
information published herein is provided for informational purposes only. The Company makes no representation that the
information and opinions expressed herein are accurate, complete or current. The information
contained herein is current as of the date hereof, but may become outdated or
subsequently may change. Nothing contained herein constitutes financial, legal, tax, or other advice.
Estimates of resources were prepared internally by Direct Petroleum. They have not been
audited or evaluated by a third party reservoir engineer. Forward-Looking
Statements |
 Expansion into
Bulgaria and Increased Presence in Morocco (February 3, 2011) – TransAtlantic
has entered into an agreement with Direct
Acquisition of Direct Bulgaria and the Direct Morocco Subsidiaries
Direct Bulgaria
3
“The acquisition of Direct Bulgaria will add
significant opportunities for the Company, and
geographically it bridges our operations in Turkey
and Romania. The deep gas potential evidenced by
the Deventci discovery well and the significant shale
potential in the Etropole formation provide near-
term and long-term catalysts for the Company,
without unnecessarily diverting resources from our
core assets in Turkey. The addition of the interests
in Morocco allows TransAtlantic to consolidate our
ability to develop the prospects there,” said Malone
Mitchell, the Company’s Chairman.
Under the terms of the Purchase Agreement, at closing TransAtlantic Worldwide
will pay DPE $2.0 million in cash and the Company will issue to DPE 8,924,478
shares of the Company’s common stock in a private placement. In addition, based
on the achievement of three distinct defined milestones (primarily keyed to
commercially viable success on certain licenses in Morocco and Bulgaria), DPE
would be entitled to receive additional shares of the Company’s common stock
with an aggregate value of up to $26.0 million.
Upon the closing of the transaction, TransAtlantic will be the parent company of
Direct Bulgaria, which owns 100% of the working interests in the A-Lovech
exploration license and the Aglen block license, covering an aggregate of
approximately 600,000 acres (2,288 square kilometers) in Bulgaria. The A-Lovech
license contains the Deventci R-1 well, which discovered a hydrothermal dolomite
reservoir in the Jurassic Orzirovo formation at a depth of approximately 4,200
meters. The well is currently producing approximately 250 mcf per day, on a
limited test basis, which is processed in a CNG facility adjacent to the Deventci R-1
well. The Company plans to appraise this discovery by drilling a second well, the
Deventici-R2, on the A-Lovech license later this year which will be located
based upon a recently acquired 3D survey over the discovery area.
The A-Lovech license is also estimated to contain over 300,000 acres prospective
for Etropole shale (at a depth of approximately 3,800 meters) which was recently
certified as a geologic discovery by the Bulgarian government. It is anticipated that
coring the Etropole interval in the Deventici R-2 well will greatly enhance the
technical understanding of the potential of this shale play. The third
established prospective area is a deep gas field on the Aglen block license that
produced approximately 9 Bcf before being abandoned in the late 1990s.
Petroleum Exploration, Inc. (“DPE”) under which TransAtlantic would acquire
100% ownership of Direct Bulgaria the Direct Morocco Subsidiaries. Closing of the
transaction, which is expected to occur by February 15, 2011, is subject to
regulatory approvals, approval of DPE’s shareholders and other customary closing
conditions. |
 Why
Bulgaria? Complementary to
operations in Turkey
and Romania w/o
diverting
resources
Gas Discovery at
Deventci R-1
Minimizes Risk
Upside from
Etropole Shale and
Aglen field re-
development
Attractive for JV
Near term
Catalyst with
Deventci R-2
“Drill Ready”
Attractive fiscal terms
promoting development of gas
resources
End user gas prices
approximately $10.00 /mcf
Royalty
2.5% -
30% (oil)
2.5% -
30% (gas)
Tax
10%
Large acreage with gas
discovery, field re-development
and conventional and
unconventional upside
Close proximity to the existing
Bulgarian gas pipeline system
Bulgaria imports ~ 90% of its
energy from Russia
’09 Average BOPD
Consumption 125k
Production
3k
Net Imports
122k
Crude Oil Consumption vs. Production
’09 Average BCF/d
Consumption 0.26
Production
0.02
Net Imports
0.24
Natural Gas Consumption vs. Production
4 |
 Bulgaria
DPE Bulgaria’s license areas are located in close proximity to the existing
Bulgarian gas pipeline system cutting across the southeastern portion of the
A-Lovech
Block.
The
block
is
within
driving
distance
from
TransAtlantic’s
yard
in the Thrace Basin. The oil service industry in Romania provides
additional
access
to
services
and
supplies.
The
port
of
Varna
on
the
Black
Sea
is
well
placed
for
the
importation
of
materials
as
is
the
Danube
River.
General location of
DPE License Area
5 |
 A-Lovech
Block
(Approximately
600,000
acres)
6 |
 Seismic
Coverage 7 |
     Seismic Type
Section Rakita half graben
Hydrothermal fluids
Carboniferous coals
Bachiishte Shale
Etropole Shale
Aglen Ridge Play
Lukovit Prospect
Deventci Type Play
Ozirovo
8 |
 Line
seismic near the Deventci R-1 well Denv-1
projection
Possible
alteration zone
9 |
 Koynare
Production Concession Contingent Resources* for Deventci
Area
P(90) 92 Bcfe
P(50) 245 Bcfe
P(10) 586 Bcfe
Structure Map on Top of Ozirovo
10
Deventci
Discovery
(P90)
(P10)
(P50)
Direct Petroleum has completed the filing for the Koynare Production Concession
(“KPC”), covering some 160,000 acres on the A-Lovech Block. The KPC is comprised of the primary
development area to be known as Deventci and three prospective resource areas along the
geological trend as shown above with the brown labels. Final approval of the KPC is expected late Q1 2011.
*Resource evaluation was prepared internally by Direct Petroleum and has not been evaluated by
a third party reservoir engineer. |
       Planned
Koynare/Aglen Pipeline and Proximity to Existing Infrastructure
Discovered Gas fields
Known structures to be drilled
The historical facilities serving the 2
previously producing wells on Aglen
have been abandoned including the
original gas plant. A new interconnect
to the Bulgarian gas transit system is
needed as well as modern production
facilities
Initial Portion of Koynare
Production Concession
DPE Aglen Field
Redevelopment
Project
11 |
 Etropole
Shale Potential 12 |
 Etropole
Fm
Shipkovo
mbr
Lopjan
or Nefela
mbr
Ozirovo
Fm
Stefanetz
mbr
Bukorovtsi
mbr
Suhundol
mbr
Borima
Fm
Dolni
Lukovit
mbr
Perfs
in Deventci
Gas shows
Shale
potential
Etropole
Shale Play
13
30%
49%
21%
Clay
Carbonates
Other |
 Aglen
Field Re-development 14 |
 Structure Map Showing Extent of Aglen
Field
15
The Aglen field was originally discovered by the Bulgarians in the late 1980s with the
assistance of Soviet oil and gas experts. After the initial two wells drilled on top of the structure
proved successful, drilling was continued on the flanks of the structure to establish the
gas/water contact. Production from the initial two wells resulted in the production of 9 bcf
without the aid of reservoir stimulation or modern production optimization. |
 Permian Basin, TX ‘38
Gas Flare Deventci R-1 well
Appendix |
   Bulgaria’s Energy Profile
Area
110,879 km2
Comparative Area
Slightly larger than Tennessee
‘09 Population Est.
7.58 million
’09 GDP (Nominal)
$50.6 billion
Fitch Sovereign
BBB Stable
Risk Rating
‘09 Proved Reserves
15 million BBLS / 0.55 BCF
‘09 Daily Consumption
125k BOPD / 0.33 BCF/d
‘09 Daily Production
3.2k BOPD / 0.02 BCF/d
Royalty
2.5% -
30% (oil)
2.5% -
30% (gas)
Corporate Tax
10%
Oil is sold at world market prices
Oil and Gas imports from Russia
Only 10% demand met by domestic supply
Source: IEA, CIA -
The World Fact Book, and IHS
17
Crude Oil Consumption vs. Production
000
BOPD
EU Member
Natural Gas Consumption vs. Production
BCF/d
’09 Average BOPD
Consumption 125k
Production
3k
Net Imports
122k
’09 Average BCF/d
Consumption 0.26
Production
0.02
Net Imports
0.24
(see next page) |
 Description of Bulgarian Licenses
License Holder:
DP Bulgaria (100%)
Term & Work
Program:
Prospecting and Exploration Permit for A-Lovech Block
•
Appraisal extension granted till end of November, 2011.
•
Each commercial discovery within the block can hold the
entire geological trend portion of the block by
converting into long term Production Concession.
•
Application for the Koynare Production Concession was
made on 11 November 2010.
•
Exploration Permit for Aglen Block
•
Primary term with extensions through April 2014.
•
Initial work commitments for first 3 years have been
fulfilled.
•
Commitment to drill 2 wells (2,500 meter minimum) in
years 4-7 (2010 thru 2014).
Production Concessions
have a primary term of 35 years
with a possible 15 year extension.
Royalty:State of
Bulgaria Based on “R”
factor and calculated by: R=TCR/TCC,
where:
•
TCR is the amount of the total cumulative revenues from
the work, connected to the object of concession, for all
periods under review, where the paid concession
remuneration is deducted
•
TCC is the amount of total cumulative costs for the work
connected to the object of concession (exploration,
prospecting, valuation, exploitation, development) for all
periods under review.
R-Factor
DPE
has
run
economic
calculations
on
the
royalty
percentages
for ranges
of “R.”
These are guidelines only as actual percentages are
determined by the Production Concession
Bonuses:
No bonuses paid during production concession
Taxes:Income tax of
10% Royalty
-
1.50
2.50%
1.50
1.74
5.00%
1.75
1.99
10.00%
2.00
2.49
12.50%
2.50
2.99
22.50%
3.00
10.00
30.00%
R-Factor Range
18 |
 19
Hydrothermal Dolomite
This
core
section
from
the
Aglen
R2
shows
typical
“Zebra”
fabric
diagnostic
of
some
Hydrothermal
Dolomite
reservoirs (“HDT”). The black areas are porous reservoir with extensive fracturing
also present. |
 GEOMETRIES OF HYDROTHERMALLY
ALTERED RESERVOIRS
From G. Davies and L Smith 2006
20 |
 HTD found in
the Deventci
well
Etropole
Fm
Bachiishte
Fm
Carboniferous coal
Bulgarian
Stratigraphic
column
21 |