Turkmenistan

Oil and Gas Conference

19-21 November 2013

Sustainable Growth Using New Technologies

Dr. Abdul Jaleel Al Khalifa
CEO, Dragon Oil
 Dragon Oil Today

Dragon Oil is a leading independent international oil and gas exploration,

development and production company
Headquartered in Dubai, UAE, with offices in Turkmenistan
Owned 54% by the government of
Dubai through the Emirates National
Oil Company (ENOC)
Our principal producing asset, the
Cheleken Contract Area, is in the
Caspian Sea, offshore Turkmenistan
The asset is being developed under
the Production Sharing Agreement
since 2000
Exploration assets in Tunisia, Iraq and
Afghanistan

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 The Cheleken Contract Area

Excellent management of reserves

13 years of production growth

and infrastructure development

DZHYGALYBEG
Continued development
N
ZH 60
(ZHDANOV) FIELD

of our people ZH 04 ZH 21
ZH 31

12 ZH 25 ZH A
TURKMENISTAN
ZH 27
BLOCK1
BLOCK2
20
GOSP
BLOCK3

DRAGON
LAM 28 LAM75 LAM 86 OIL CAMP
LAM 21 30
LAM A 30 CPF
LAM B
LAM 63 LAM 10 TRUNKLINE
LAM 04
KARAGEL
LAM C
TANK

LAM 13
CASPIAN SEA FARM

LAM 22
ALADJA
JETTY
DZHEITUNE (LAM) FIELD Export

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 Achievements since 2000

Impressive gross production growth since the commencement

of the Production Sharing Agreement in 2000

Organic 2P oil and condensate reserves replacement of 190%

against cumulative gross production

Capital investment of over US$2.8bn

Building well-head platform at Hazar

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 Gross Production Growth

BOPD Tons/day

100,000 13,000
Gross average daily crude 12,000
90,000
oil production, bopd 11,000
80,000 10,000
70,000 9,000
Average gross production
8,000
60,000 annual growth
7,000
50,000 6,000 21%
40,000 5,000
30,000 4,000
2015 gross production target
3,000
100,000
20,000
bopd 2,000
10,000 1,000
- -
2000 2002 2004 2006 2008 2010 2012 2014F 2016F 2018F 2020F

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 Capital Investment

3.00
US$2.8bn
Cumulative capital
2.50 investment, US$bn

2.00

1.50

Onshore and
1.00 offshore investment

US$2.8bn
0.50
Operating costs over the period

0.00
US$0.6bn
2000 2002 2004 2006 2008 2010 2012

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 Reserves Replacement

700 Reserves replacement over

12 years
600

500 141
267
190%
400 Reserves replacement in
677 2012
300
551
200 180%
100

-
2000 Cumulative Reserves 2012 Year
Original Production Additions End
Reserves Reserves
Platform-based drilling rig.

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 New Platforms

Eight new platforms constructed and installed in the Dzheitune (Lam) and
Dhzygalybeg (Zhdanov) fields
Four wellhead and production platforms: Lam A, B and C and
Zhdanov A
Three gathering blocks: Block-1, 2 and 4
One accommodation platform to complement the Dzheitune (Lam) 22
production platform
Zhdanov B Platform is being
constructed and modified

Zhdanov A Platform Installation.

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 Oil Storage

Oil Storage
Total oil storage capacity of 300,000 barrels
The new tank farm

Dragon Oil Tank Farm.

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 Production Technologies

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 Pressure Maintenance

Water Injection
Start date: 28 June 2013
Current injection rate: 3,500-4,000
bwpd
Average pressure increase in neighbor
wells: around 100 psi (to be verified
through another survey)
Plan to expand water injection
operations to 2-3 more platforms
during 2014
Impact is 5-10% potential additional
recovery where applicable
Maintain pressure, sustain production
rates and increase reserves recovery
Water Injection Implementation.

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 Artificial Lift KPIs

Jet Pumps
Start date: 5 June 2013 in two
wells: Dzheitune (Lam) 13/118,
13/168
Average Production increase: 500-
700 bopd/well
Plan to expand Jet Pump
operations to 14 more wells
during 2014
Objective is to increase
production and enhance recovery

Jet pumps implementation.

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 Advanced Technology Implementation

Chemical Trials
Application: The effectiveness and cost of current chemical injection systems
and chemicals for wax and corrosion reduction.
Trial: Chemical injection trials using four different chemicals were carried out
in the year 2012.
Result: Reduction in pour point temperature, viscosity, accumulated wax in
the pipelines.

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 Advanced Technology Implementation

3D Laser Survey
Objective: Plant modifications and changes which
are not reflected on the master drawing could be
captured.

Technology : Survey using Rapid 3D Laser scanning.

Photograph of platform

Surveyed Platforms: LAM 21, LAM 22, LAM 75,

LAM 10 and introduced : 1st Quarter 2013.

Way Forward: Plan to survey 9 Offshore platforms

and 3 Onshore facilities in 2014-2015.

PDMS model generated

from scanning data

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 Company Procedure Improvement

Integrity Management System (IM): To ensure safety

and reliability of the plant assets.
Structures Integrity Management System (SIMS)
Pipelines Integrity Management System (PIMS)
Corrosion Management System (CMS)

Engineering Management System (EMS): standardized

procedures, Forms, Templates, check lists, Technical
Specifications & Data sheets and Quality procedures &
Specifications

ISO 9001:2008 certified; including OHSAS18001:2007

Organisations and certified / recognised as
OHSAS14001:2004 Organisation Pipelines Integrity Management System (PIMS)

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 New Technologies

Already Installed
Water Injection
Jet Pumps
Expandable screens
Remote Pig Tracking
On the way
ESP
Cable Heating
Gravel Packs
Wax Elimination Rings (Vibration Induced
Technology)
Intelligent Pigging
On evaluation
Multilateral Wells
Subsea Pipeline Cleaning using Nitrogen &
Heat Generated System (SGN Technology)

Implementation of new technologies.

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 Investment in People
Our Talent
Over 1,550 professional
originating from 50 countries
92% of Dragon Oil Turkmenistan
workforce are Turkmen nationals
Attractive career opportunities
Dragon Oil employee.
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Training and Development
In-house and external training programs with
particular focus on national employees
Develop HI potential employees with
identified Individual Development Plans
linked to Succession Plan Program
Assistance with higher education tuition fees
Training and development of Dragon Oil employees.
17
 Investment in Communities - Polyclinic

Major c.US$5mn project completed: polyclinic building and related

infrastructure
Inauguration took place in March 2013

2011: concept stage. 2012: construction. 2013: completion.

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 Future Growth and Development

Production target of 100,000 bopd in 2015 and plateau at this level for

at least five years thereafter

Deployment of significant jack-up and platform-based rig capacity

Extraction of condensate at a GTP

Loading Crude Oil at Aladja Jetty, Hazar

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 Conclusion

Continued growth of Dragon Oil and our excellent

performance are made possible thanks to our
truly successful partnership with the
State Agency and all other concerned authorities

Thank you

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