Valeura Energy finds JV partner for Thrace deep gas play testing
Valeura Energy Inc. has entered into a new joint venture to explore for and develop hydrocarbons in the deep rights formations of the Thrace basin of northwest Türkiye.
The agreement was entered into through a Valeura subsidiary, together with partner Pinnacle Turkey Inc., with a subsidiary of Transatlantic Petroleum LLC.
"Despite our strategic pivot toward the Asia-Pacific region, we have maintained our conviction that the deep gas play we discovered in northwest Türkiye offers significant potential to add value to the company,” said Sean Guest, president and chief executive officer of Valeura, in a release Oct. 15.
“Our drilling program from 2017 to 2019 demonstrated that there are multiple tcf of gas in place across Valeura's lands in a deep tight gas play. We drilled three wells into this play and tested 12 separate zones - every one of which flowed gas. It is my hope that with a reinvigorated push to test the play, we will see this evolve into a commercial success,” he continued.
Thrace deep gas play, Türkiye
Valeura has held various blocks and operated in Türkiye for almost 15 years. The company continues to hold the deep rights (below 2,500 m or a pressure gradient of 0.6 psi/ft, whichever is shallower) in various exploration licenses and production leases covering a total of 955 sq km (gross) in the Thrace basin, just west of Istanbul. The current exploration phase for most of the acreage (lands held under exploration license) expires June 27, 2026, but discussions are under way with the government for a 2-year appraisal period extension, the company said.
Between 2017 and 2020, Valeura explored and discovered a ubiquitous, gas-charged, over-pressured sandstone reservoir, believed to represent a basin-centered gas play at depths of about 2,900-4,775 m. In conjunction then-partner Equinor, it drilled the Yamalik-1, Inanli-1, and Devepinar-1 exploration wells, all which demonstrated the presence of hydrocarbons. The company undertook hydraulic stimulation of 12 separate intervals, all which flowed gas to surface. The testing program included one long-term test that was flowed and sold into the gas grid for about 3 months. While the drilling program confirmed multiple tcf of gas in place, none of the wells were declared a commercial success at that time given the flow rates and local gas price.
Since the exit of Equinor from the play in second-quarter 2020, the assets have remained an operationally dormant part of Valeura's portfolio.
Joint venture
Transatlantic has operated in Türkiye since 2007 and has partnered with both Valeura and Pinnacle in the Thrace basin between 2011 and 2017 as operator of the conventional gas production. Transatlantic will serve as contract operator for the venture, with Valeura remaining the operator of record designated with the Government of Türkiye.
The joint venture provides an opportunity for Transatlantic to earn a 50% undivided working interest in the deep rights held by Valeura and Pinnacle through two separate operations.
Devepinar reentry
Valeura drilled and hydraulically stimulated the Devepinar-1 exploration well in 2019 and conducted short-term tests of three separate intervals in the deep part of the Kesan formation at a depth of 4,660-4,765 m. While gas was produced at good initial rates from all intervals, relatively high decline rates were observed that suggested the zones would not support long-term commercial flow rates, Valeura said. The company preserved the well in a suspended state and performed technical modeling work alongside its search for a new joint venture partner.
Under the terms of the joint venture, Transatlantic agreed to undertake a reentry of the Devepinar-1 well including hydraulic stimulation and testing of shallower zones in the Kesan. If the results constitute a commercial discovery, Transatlantic shall earn a 50% proportion of the working interest held by each of Valeura (currently 63%) and Pinnacle (currently 37%) in the western portion of the lands (comprised of the West Thrace Production Leases and West Thrace Exploration License).
Transatlantic will pay 100% of the costs to reenter the Devepinar-1 well, up to $2 million. Any additional costs will be shared amongst the parties, 50% Transatlantic, 31.5% Valeura, 18.5% Pinnacle. Testing operations are expected to begin in fourth-quarter 2025.
Deep appraisal well
Transatlantic has an option to earn an interest in the eastern portion of the lands (the Banarli Exploration Licenses) by drilling a well down to at least 4,000 m on either the western or eastern portion of the lands. If such the drilling results in a commercial discovery, Transatlantic shall earn a 50% proportion of the interest held by Valeura (currently 100%). Transatlantic will pay 100% of the costs up to $8 million, and any costs there above shall be shared 50% Transatlantic, 50% Valeura.