StockMarketWire.com - Oil company United Oild & Gas downgraded its annual output forecast after a higher proportion of water started being produced at key wells in Egypt.

Full-year output from the Abu Sennan licence in Egypt was now expected at 2,100-to-2,300 barrels of oil equivalent per day, down from previous guidance of 2,500-to-2,700 boepd.

The ASH field at the Abu Sennan licence had three wells in production, which had performed exceptionally well in the first half.

However, since early July the proportion of water to oil being produced had increased on all three wells, particularly on ASH-2, where it had increased at a faster rate than expected.

United Oild & Gas said the joint venture partners had performed a number of operations to investigate options for controlling the water-cut and stabilising production.

These included looking at the effect of differing choke sizes, shutting in various perforated intervals, and running production logging tests.

'The JV partners are still in the early days of monitoring the performance of the wells since the interventions were performed and are continuing to consider other options that could help stabilise the decline,' it added.

Overall production from the Abu Sennan licence in the six months through June was 2,730 boepd.

The other six fields on the licence were entirely unaffected by the water issue and producing in line with expectations.

Production from the Abu Sennan licence as at 4 September was 1,817 boepd, net to the company's working interest.


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