Snippet from Annual info form - Kurdamir 1The form WZR has is loaded with good info. Well worth the read;
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Kurdamir-1
Drilling operations at the Corporation's second exploration well, Kurdamir-1, commenced on May 11, 2009 and the
well reached total depth of 4,077 m in February 2010. Due to the high formation pressures encountered at 4,077 m,
no deeper drilling will take place in the Kurdamir-1 well.
In the last quarter of 2009, the Corporation successfully completed logging and coring and conducted two open-hole
drill stem tests in the Tertiary interval, which confirmed a significant hydrocarbon accumulation and the presence of
a reservoir within the Oligocene formation in this interval (see "Resource Information"). Combined test rates
indicate approximately 27.5 MMcf/d of gas and 1,172 bbl/d of 61°API natural gas liquids (condensate). Test rates
were limited due to testing equipment restrictions; however, initial well test analysis conducted by an independent
third party indicates that reservoir production potential of approximately 52 MMcf/d of gas and 2,240 bbl/d of
condensate could be expected from these intervals. No formation water was recovered during the testing. In
addition, the Corporation has received an independent geochemical evaluation of the condensate tested from this
Oligocene reservoir which indicates that the condensate is from an oil-prone source and is likely to be associated
with an oil column deeper in the Kurdamir structure.
Following testing of the Oligocene reservoir, Kurdamir-1 penetrated the Aaliji Seal and the Shiranish reservoir
target and drilled into the Gulneri Seal where a high pressure zone was encountered. Well control operations to
counter the high formation pressures at the bottom of the hole required cementing the drill string in the hole below
2,702 m and were completed on March 19, 2010. Numerous oil and gas shows were encountered while drilling
through the Aaliji and Shiranish formations in the Cretaceous interval and the Corporation's plan is to sidetrack to
redrill the Aaliji and Shiranish formations, run wireline logs in the open hole and then conduct a cased hole testing
program.
Future Exploration Activities
Possibilities currently being analyzed for future exploration activities include drilling a well on the flank of the
Kurdamir structure to determine if the Oligocene reservoir deeper than 2,312 m is oil bearing or gas-condensate
bearing; and contracting an alternative rig to allow for greater flexibility in drilling to the reservoir targets for the
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third exploration commitment well. In this regard, WesternZagros, on behalf of the Contractor Group, has made
application to the KRG to extend the first exploration sub-period under the PSC for a period of 12 months in order to
allow sufficient time to analyze the results of the Kurdamir-1 cased hole testing program prior to commencing future
exploration activities.
Resource Information
WesternZagros engaged Sproule to audit the Corporation's prospective resource assessment with respect to over 20
prospects and leads in both the Tertiary and Cretaceous reservoirs located in the PSC Lands in May 2009 and the
Corporation's contingent and prospective resource assessment with respect to the Tertiary interval at Kudamir-1 in
the PSC Lands in November 2009.
Sproule carried out its audits in accordance with the guidelines outlined in the COGE Handbook and in accordance
with NI 51-101. Pursuant to the COGE Handbook, an audit is the process whereby an independent qualified
reserves auditor carries out procedures designed to allow the independent qualified reserves auditor to provide
reasonable assurance that a reporting issuer's resource data (or specific parts thereof) have, in all material respects,
been determined and presented in accordance with the COGE Handbook and are, therefore, free of material
misstatement.
Sproule has provided its opinion in the Sproule Reports that, as of the respective dates of such reports, the resource
estimates audited by Sproule, as described below, were determined in accordance with industry practice and the
required guidelines and definitions contained in the COGE Handbook, were free of material misstatement and, in
aggregate, were reasonable representations of the quantities of contingent and prospective resources and the
technical uncertainties currently associated with them.
The Sproule May Report was completed prior to the drilling of Kurdamir-1 and provided an independent audit
confirming the Corporation's resource assessment with respect to over 20 prospects and leads in both the Tertiary
and Cretaceous reservoirs located in the PSC Lands assuming an all oil case. As of March 31, 2009, WesternZagros'
best estimate of gross unrisked Prospective Resources in the PSC Lands was 2.4 Bbbl, with low and high estimates
of 1.6 Bbbl and 3.5 Bbbl, respectively.
With respect to the Tertiary interval at Kudamir-1, as of November 23, 2009, the best estimate of gross unrisked
Contingent Resources across the crest of the Kurdamir structure down to a depth of 2,312 m was 523 Bcf of gas and
21 MMbbl of condensate, with low and high estimates of 379 Bcf and 696 Bcf of gas, respectively and 13 MMbbl
and 32 MMbbl of condensate, respectively.
These estimates of Contingent Resources do not include any potential in the undrilled downdip flanks of the
Kurdamir structure in the Tertiary reservoir deeper than 2,312 m. If the Tertiary reservoir below 2,312 m on the
flanks of the Kurdamir structure contains gas and condensate only, as of November 23, 2009, the best estimate of
gross unrisked Prospective Resources is 363 Bcf of gas and 15 MMbbl of condensate, with low and high estimates
of 180 Bcf and 609 Bcf of gas, respectively, and 8 MMbbl and 25 MMbbl of condensate, respectively. If the
Tertiary reservoir below 2,312 m on the flanks of the Kurdamir structure contains oil only, as of November 23,
2009, the best estimate of gross unrisked Prospective Resources is 100 MMbbl, with low and high estimates of
32 MMbbl and 207 MMbbl, respectively.
The resource estimates for Kurdamir-1 do not include any assessments for the Aaliji and Shiranish formations in the
Cretaceous interval which were drilled subsequent to the Sproule November Report. The Corporation plans to
complete a revised resource assessment for the PSC Lands, including Kurdamir, following completion of the cased
hole testing program at Kurdamir-1. Additional information obtained from drilling, analysis of core data,
additional testing or additional seismic data may result in a change to the prior assessments of the PSC Lands
and Kurdamir-1 and such a change may be material.
Contingent Resources have an associated chance of development. These estimates have not been risked for the
chance of development. There is no certainty that the Contingent Resources will be developed and, if developed,
there is no certainty as to the timing of such development or that it will be commercially viable to produce any
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portion of the Contingent Resources. Prospective resources have both an associated chance of discovery and a
chance of development. The chance of commerciality is the product of these two risk components. These estimates
have not been risked for either the chance of discovery or the chance of development. There is no certainty that any
portion of the Prospective Resources will be discovered. If a discovery is made, there is no certainty that it will be
developed or, if it is developed, there is no certainty as to the timing of such development or that it will be
commercially viable to produce any portion of the Prospective Resources. The Corporation's material change reports
filed on SEDAR at www.sedar.com and dated May 12, 2009 and November 25, 2009 contain additional detail on
the resource estimate ranges and include the risks and level of uncertainty associated with the recovery of the
resources, the significant positive and negative factors relevant to the estimates and, in respect of the Contingent
Resources, the specific contingencies which prevent the classification of the resources as reserves.