MENA Hydrocarbons Operation Update for Lagia

MENA has signed a contract with Petroservices Drilling Overseas (PSDO) of Egypt for the rental of their 750 HP rig Shams 1 in order to commence operations on its Lagia oil field development in Egypt. The six well programme consists of working over two existing wells, the drilling of two development wells and drilling a further two appraisal wells, one of them contingent. The recently built rig is on its way from Tian Jin in China and expected to arrive in Egypt in the first half of February for commencement of operations in the Lagia license.

MENA has finalised all other work programmes and service contracts to commence work over and drilling operations. The existing Lagia 6 and 7 wells are expected to be completed with a subsurface pump whereafter two development wells and two appraisal wells are planned to be drilled to the top of the Thebes formation at around 1500 ft. The development wells will be completed with thermal casing in order to facilitate steam injection as part of a cyclic steam soak pilot project and fitted with a sucker rod pump.

A contract for the rental of a 24 MM BTU steam plant is currently being negotiated. Temporary Production facilities for the pilot phase are planned to be rented from Sigma Petroleum Services enabling Installation in line with drilling activities. The produced oil will be transported by road tanker to the production facilities of the General Petroleum Company (GPC) at Ras Gharib. First routine production is expected in the second quarter of 2012.

Lagia Oil Field

MENA is the sole owner of the Lagia Development Lease covering a 32 sq km block of land located on the Sinai Peninsula, directly adjacent to the Gulf of Suez. Within the lease, four wells have been drilled between the years 1949 to 2000 that have identified the Lagia oil field. Three producing oil fields, Sudr, Matarma and Asl, are located as close as 26 km to the north of the Lagia oil field.