Hello, and welcome to the Panoro Energy second quarter 2019 results webcast. My name is Molly, and I'll be your coordinator for today's event. For the duration of the call, your lines will be on listen only. However, there will be an opportunity to ask questions later in the call. If you require assistance at any time, please press star zero on your telephone keypad, and you will be connected to an operator. I will now hand you over to your host, John Hamilton, to begin today's conference. Thank you.
Thank you, Molly, and good morning to everybody. This is John Hamilton, Chief Executive Officer of Panoro Energy ASA. On this second quarter 2019 results, we're going to try something a little different with the webcast. Hopefully, the technology works. In any case, the presentation, our second quarter results, and the press release are all available on our website at www.panoroenergy.com. For any reason you are having trouble with the webcast, the presentation is available on the website as well. If I could turn now from the cover slide to slide number two, which is our disclaimer. I would just like to remind everybody today that today's conference call contains certain statements that are or may be deemed to be forward-looking statements, which include all statements other than statements of historical fact.
Forward-looking statements involve making certain assumptions based on the company's experience and its perception of historical trends, current conditions, expected future developments, and also other factors that we believe are appropriate under the circumstances. Although we believe that the expectations reflected in these forward-looking statements are reasonable, actual events or results may differ materially from those projected or implied in such forward-looking statements due to known or unknown risks, uncertainties, and other factors. If I could please turn the page to slide number three which is our presenting team. We are sat together here in Oslo. Myself, John Hamilton, I'm joined today by our CFO, Qazi Qadeer, Richard Morton, our Technical Director, and Nigel McKim, our Projects Director.
The format today is we'll take you through a few slides to tell you a little bit about the business, second quarter results of course. We will turn it over to questions at the end if there are any. Each of the four participants here are available to answer questions from the audience. If I could please turn to slide number four now, which is titled Q2 2019 Highlights. Operationally, Dussafu in Gabon, average gross production over the quarter was over 12,000 barrels a day and continues to produce above expectations. The Dussafu drilling program has commenced with the spudding of a Hibiscus up-dip well, which we'll tell you a little bit more about, followed by four production wells, then thereafter, a minimum of one more exploration well. Lots going on at Dussafu, which we'll touch on.
TPS production was about 4,000 barrels a day gross for the quarter, with a target of 5,000 barrels a day by the end of the year, and circa 4,500 or 15% by the end of Q3. The Salloum West exploration well is on track for spud towards the end of the year. We'll tell you a little bit more about that. At Aje, production has remained stable, and the partnership there remains focused on advancing the Turonian gas development. Financially, we had gross revenue of $10.7 million in the quarter in line with our listings guidance. For the first half of the year, it's $30.6 million of gross revenue. EBITDA for the quarter was $5.1 million, and a first-half result of $16.3 million of EBITDA. Cash balances, including cash held for bank guarantee at Sfax Offshore is $25.5 million, and gross debt of $27.4.
The results are impacted this year by a reversal of an impairment at Dussafu, which Qazi will touch on a little bit later. If I could turn now to slide number five, titled Active Work Program Over the next 12 months and Beyond. I think the title says it all. We are entering a very busy period here at Panoro. We have just spud in Gabon, the exploration well at Hibiscus up-dip which will be followed in the orange by four production wells, phase two production wells, followed again in the green by an exploration well and possibly extra exploration wells as well. Moving into 2021, which is a little ways off still, but we'll be looking at phase three. In Gabon, we have a target of over 20,000 barrels a day by the second quarter of 2020. These are operator numbers.
Obviously, we hope to do better than that, but that is the current target. In Tunisia, we're also extremely busy. We have an exploration well being spud towards the end of the year at Salloum West. We have workover activity ongoing as we speak. We'll get into some details of that. In terms of looking forward to 2020, we have lots of other opportunities identified in the slightly muted colors, workover activities, possibly a new production well, possibly some seismic and an additional exploration well as well. Our target at TPS is to be at 5,000 barrels a day by the end of the year, which represents a 25% uplift from when we took over the asset. If I could turn now to the next slide six, key metrics.
We'll take you now through some numbers, which hopefully give you a little bit more granularity in terms of the performance of the business. If I could turn now to slide number seven, entitled Production Growth. For those of you who have followed Panoro for some time, you know that we have gone through an exponential growth recently from 2017. We were producing about 300 barrels a day to currently where the group is producing about 2,500 barrels a day. It's been an eightfold increase in production, and that is obviously very visible in our financials that we're presenting to you. As I stated before, at TPS, we're targeting 5,000 barrels a day by the end of the year. At Dussafu, we're targeting a 65% increase, taking us to at least 20,000 barrels a day during the first and second quarter of next year. That should say 2020, not 2019.
We do note that Tullow does have a back-in right to the Dussafu asset, which is in process of being documented. That would see our share production drop by 10%. At Aje, we're expecting for the moment that the asset will continue to produce 300 barrels a day net to Panoro. Taken in aggregate in 2020, during the course of the year, we're targeting a 3,500 barrel a day headline rate during the course of the year, with an upside potential, not including any exploration success at Salloum West, for instance, of over 4,000 barrels a day. Hopefully, everybody can get a feel that we have still quite an upward trajectory here in 2020 with production targeted at least 3,500 barrels per day, with an upside case well beyond that. If I could turn now to slide eight, the key metrics at $65 Brent.
I'd like to talk to you a little bit about the economics of what it is we are doing. If we assume $65 Brent, which is a little bit higher than it is today, but it gives you a good idea. In Dussafu, Gabon, on the left, we have $23 a barrel currently of OpEx per barrel. We're going to see that reduced to approximately $15 a barrel once the second phase production comes online. More production covers the fixed cost base of the asset, and therefore, the unit costs come down quite dramatically. It's quite an attractive rate. The netbacks, we're currently enjoying around $28 a barrel netback. That's after OpEx and tax. Upon phase two coming on stream, we would hope to be above $30 netback per barrel at $65 Brent. In Tunisia, it's already a very low-cost operating environment.
There are probably things that we can do at the margin to optimize that, but it's already an extremely attractive operating environment where we're doing about $12 a barrel. The netbacks there, the tax regime is a little bit different, are about $20 a barrel at $65 Brent. Both of those numbers, the 12 and the 20, can be improved on if we're able to achieve the increase in production. Again, same concept where you're putting more production across a largely fixed cost asset base. Every extra barrel you can produce helps to decrease your OpEx per barrel and therefore increase your netback. Hopefully that gives you a flavor a little bit about the underlying economics of the production that we talk about and the production targets that we talk about.
If I move now to slide number nine, which is titled Q2 2019 highlights, I'd like to turn over to Qazi Qadeer.
Thank you, John, and good morning, everyone. We are on slide number nine. We announced our half-year report this morning, which is available on our website, www.panoroenergy.com, and contains detailed analysis of quarter-on-quarter and year-to-date movements. I'm only going to discuss key financial highlights this morning, which are summarized in the slide. To begin with, revenue and other income for the quarter was $10.7 million in 2Q, decreasing from almost $20 million in the first quarter. Please note here that other income is also included in the revenue line, which is a tax gross up for Dussafu in order to report consistently the tax under the tax line. Breakdown of revenue and other income is available in our 2Q report.
The decline in oil sale revenue is a direct result of lower liftings during the second quarter, which is in line with the guidance we provided in the first quarter presentation. We are also impacted by lower oil price realizations in the second quarter compared to the first quarter. Looking at the first half results, it is reflective of the operational activities for the period on an average basis and is a good benchmark for the number of liftings for the second half of the year, which we expect to be between five and six international liftings. Consequently, EBITDA for 2Q was $5.1 million, compared to $11.3 million for the first quarter 2019. Again, this is a function of lower sales volumes and lower oil price realizations and an element of fixed operating cost base within the cost line.
Net profit after tax is higher in the current quarter at $8.1 million, compared to a loss of $1.5 million in the first quarter. This is due to reversal of impairment on Dussafu, which was $8.2 million that we have reversed this quarter. The trigger for reversal of impairment is the upward revision of reserves. We also report our results on an underlying basis using non-GAAP measures. After excluding items of non-recurring and non-performing nature, like impairment and effects of commodity hedges, we end up with a pre-tax income of $1 million in 2Q, and $7.8 million in the first quarter in comparison. This concludes the finance section, I will now hand over to Richard to take us through the following slide, which will be slide number 10.
Thank you, Qazi, and good morning to everyone. The next five slides, I'll walk through the activities in Gabon. We're on slide 10, entitled Gabon. As a reminder, we're in the Dussafu Marin Permit
There are five fields within the permit: Mbenga, Walt Whitman, Ruche North East, and Tortue. The latter three of these fields were discovered by Panoro and our partners in the last seven years. Go to the next slide 11. This is a description of the first of the fields that's come on production, the Tortue field. Of course, we have a 8.33% share of this license. Phase 1 is currently on production at 12,000 barrels a day. This particular project was sanctioned from sanction to production in 18 months, which is a very fast-track development. We're currently producing from two subsea wells into the BW Adolo FPSO. That's got a capacity of 40,000 barrels per day and is conceptualized as the area hub for production from within the Dussafu license area.
We haven't seen any water or wax production to date. This has enabled us to lift the reserve base at the beginning of this year. The gross investment for phase 1 totaled $175 million. Phase 2 is sanctioned, and the project is underway. We're benefiting, of course, from the existing infrastructure in the area in the shape of the FPSO. We'll tie new wells into that facility. There are four production wells to be drilled, three in the Gamba and one in the Dentale D6 reservoirs. The rig, the jackup Borr North, is currently on location, drilling an exploration well. We'll touch on that in a moment. It will go on to drill the four development wells. That constitutes phase 2.
We see these wells coming on stream in Q1 2020, and we have a total of 35 million barrels for the combined phase 1 and phase 2 as a gross reserve at the start of this year. The gross investment for this phase is around about $240 million. We expect production to be in excess of 20,000 barrels in Q2 2020. We'll move on to the next slide 12. This is a timeline of the Dussafu story. Top left, we have a map of the exploitation area showing where the FPSO is located in the bottom right, the Tortue field. Four other discoveries on the field on the license area, Mbenga, Walt Whitman, Ruche, and Ruche North East. In between 2011 and 2014, we were in the exploration phase.
We drilled the Ruche and Tortue discoveries, benefiting from 3D seismic data, and moved into a commercial declaration which enabled the granting of the exploitation permit. It's quite a large area, 850 sq km, so plenty of room for future phases. We're currently in the development and early production phase. At present, first oil was achieved in September 2018. During that phase of development, we drilled an appraisal well at Tortue. We drilled an oil discovery at Ruche North East, and we had the reserve upgrade at the beginning of this year. We've taken an FID for phase 2, and we're currently spudding or have just spudded the Hibiscus well. We're about to commence the phase 2 development drilling. Moving forward in the future, we're looking to sanction phase 3, which will be the Ruche/Ruche North East area, and develop other discoveries within the block, Walt Whitman and Mbenga.
In addition, as you can see from the map, there are lots of additional prospects to drill for the further exploration. Production-wise, on the right-hand side, we can see that we've grown from 10,000 to 12,000 barrels a day at phase 1, moving up to 20,000 or more at phase 2, and we can target 30,000 barrels a day for phase 3. Further fields coming in will increase that number. Moving on to slide 13. This is talking about the Hibiscus up-dip well, which we are currently drilling, spudded on the 10th of August. This is drilled at a location that's up-dip from an existing well drilled in 1991 by ARCO. This well had very good reservoir quality, and it had oil shows in the core. We believe we're in an up-dip location from the 3D seismic data, which was acquired since that well was drilled.
We're targeting a four-way dip close structure with a resource size similar to the Tortue and Ruche discoveries, which Tortue already on production and Ruche will be phase three. As I mentioned, this is the start of a six-well campaign. Hibiscus is the first of these wells. The four production wells to follow at Tortue, leading into 2020. We have an additional exploration well to come in 2022, Q2. Following that, there are additional two slots available for the JV to utilize for further exploration drilling should we desire to do so. Move on to the next slide 14. This is a description of phase three of the project, which will see development activities commence at Ruche and Ruche North East. This has the potential to add another 15,000 barrels of oil per day gross production to the project. It will be the second development hub.
The FID is expected later this year. From this project, we expect first oil to be achieved in Q4 2021. If we have a discovery at Hibiscus up dip, then any resources there will be added into this current phase 3 of the project. The concept is a wellhead platform, which will be tied back to the FPSO for processing, storage, and exploitation. We're conceptualizing currently six wells for this project and targeting 28.5 million barrels of reserves. The CapEx for this is around $375 million. The production from Ruche will extend past the end of the term of the license in 2037, 2038. That's the description of the Gabon project, and I will now hand over to my colleague, Nigel McKim, who will take you through the activities at Tunisia.
Thank you, Richard. Good morning, everybody. We're on slide 15, the Tunisia introductory slide. In Tunisia, we have an active operational program in progress on the TPS assets, where a number of well workover operations are currently underway. Whilst on the Sfax Offshore Exploration Permit, we're in the midst of detailed planning for the drilling of the Salloum West well. I will go on to describe these activities in a little more detail using the next few slides. The next slide 16, enhancing TPS production levels. Panoro has interest in five producing concessions in Tunisia. The average gross daily production during the quarter was approximately 3,950 barrels of oil per day. Our near-term objective is to increase production by 15%-20% around the end of Q3 2019, and we are targeting a gross production of 5,000 barrels of oil per day by the end of 2019.
This slide shows the historical production from the TPS assets since 1981. We display here the production from each of the six fields on the five producing concessions. It is the total production level from these fields that tells a story. After a ramp-up of production through the 1980s and 1990s, the impact of relatively low oil prices at the end of the '90s can be seen to have constrained further development in the early 2000s. Later in that decade, production in excess of 6,000 barrels of oil per day was established from this group of fields. In recent years, production has fallen significantly below these levels as a result of a period of relative underinvestment. We believe that this situation can be turned around, and I'll touch on some of the initiatives that we're currently pursuing to deliver this objective.
On the right-hand side of this slide, we have identified the types of activities that are expected to underpin the current and future production. Firstly, it is important to state that there are ongoing activities required to maintain the existing production, shown in blue. We lift our wells with electric submersible pumps or ESPs. These have limited lives and need to be replaced at regular intervals. This will be an ongoing activity. We're also hoping to improve our pump performance. The enhanced production, shown in orange, is expected to be achieved by a variety of measures, amongst which optimizing the production system, recompletions on new reservoir intervals, sidetracks to undrained reservoirs or blocks, and the drilling of new wells into nearby discoveries.
It is worth remembering that the economic life of this group of assets extends well into the 2030s, and that there will be plenty of activity over the coming years. For the purposes of this presentation, I'll focus only on the near-term activities. On the next slide 17, TPS well activities. This slide shows the specific ongoing and planned activities. Guebiba 2 was worked over in July to replace a punctured downhole completion. While Rhemoura-1 has just been worked over to replace a failed ESP. As we have said before, the highest impact near-term opportunity is the resumption of production at the El Ain field. We currently have an ongoing workover operation on the El Ain-3 well, where we are completing the well with an ESP for the first time. Looking forward, we plan a series of additional well workover operations.
On Guebiba-4, we hope to recover a failed downhole completion and complete the well on a new reservoir interval. At El Ain-1, we are awaiting a workover rig operation late this year to run an ESP for the first time. In the new year, we expect to be able to sidetrack the Guebiba 10 well to a new target in the same reservoir. Further analysis is in progress to plan operations at Guebiba 5 and Guebiba 7. Finally, you will see the Salloum West proposed well location, which I'll now go on to talk about in a little more detail. On slide 18, titled Salloum Structure Bireno Depth Map. As a precondition to the entry into a second renewal period for an additional three-year term, we have now agreed to fulfill the outstanding drilling obligation. This entails drilling the Salloum West-1 well in order to fulfill the commitment well conditions.
We are currently working closely with our partner ETAP regarding the technical program and the formalization of drilling plans, including well planning, location, and approvals for drilling. The primary target of the Salloum West well is the Bireno formation at approximately 3,200 vertical meters of depth. Where we have identified on 2D and 3D seismic data what we believe to be an independent block located west of the discovered Salloum structure. The well will target an independent fault compartment up dip from the discovery well, which was drilled by British Gas in 1991 and tested the Bireno formation at a rate of some 1,800 barrels of oil per day. The objective of this new well is to prove up additional resources in the vicinity of the Salloum-1 well and to aggregate them in an order to develop Salloum through a tieback to existing adjacent oil infrastructure at TPS.
We are now in the midst of detailed operational planning with the intent to spud the well late in 2019. I'll now hand back to John for the next slide 19.
Thank you, Nigel. Slide 19, environmental, social, and governance. We're a busy company. Everybody can see that. I think it's worth reminding everybody that in the process of going about our operations, our increased activity levels in all of the countries in which we operate, we have a commitment to operate responsibly wherever we work in the world, and to engage with our stakeholders to manage the social, environmental, and ethical impact of our activities in the markets in which we operate. We have a lot more information in terms of our policies. Those are available on our website. It's perhaps a part of the website that some people don't go to, but they are there, and I encourage people that are interested in this topic to please look on our website for our various policies and procedures, which we take very seriously.
Finally, turning the slide to slide number 20, our final slide before opening up for questions. Just to highlight things that have come out of the presentation that you've just heard in terms of our outlook as well. We're going to be a very busy company for the next 12 months. We're going to be drilling three, four, possibly five exploration wells, including Hibiscus Updip and Salloum West in the next 12 months. We have four new development wells going down in Tortue, which should hopefully boost production materially at Dussafu. In Tunisia, you've heard what Nigel has said in terms of our near term and future opportunities that we have to really materially increase production at our assets in Tunisia, and work is well underway to commence that.
We are obviously, in the meantime, trying to do all of this in a very safety conscious and ethical manner, all this activity. Of course, as everybody who follows Panoro knows, we are continuing to focus on our strategy and on our business development and trying to ensure the longer-term future of this company. With that, Molly, I'd like to turn over to any questions that we may have from the audience. Thank you.
Thank you. If you would like to ask a question via the phone lines, please press *1 on your telephone keypad and ensure that your telephone line is unmuted locally. You'll then be advised when to ask your question. The first question comes from the line of Teodor Sveen-Nilsen, calling from SB1 Markets. Please go ahead.
Good morning, thanks for taking my questions. I have actually three questions. The first one, a question on the reverse of impairment. Is the only recent put change of the carrying value changes to reserves, or have you made any other changes to your valuation of that? Second question is on Salloum. Indicator of success, when do you expect to be able to report first oil? Third question is, should we expect three listings in third quarter as a fairness note? Thank you.
Qazi, do you want to take the reversal impairments question?
Yes, Teodor. We basically monitor triggers for any impairment reversal, and one of the biggest factors in our assessment was the revision of reserves and also that we are progressing the project forward with phase two and an imminent phase three sanction as well. What we are looking at is the Undris project, which is supporting the economics. That basically drove us to perform this reassessment of reversal of impairment losses that we had recognized in the past. This is in line with all the current accounting standards that we have used to assess this item.
Right. Nigel, can you tell Teodor a little bit about what happens in the Salloum West success case?
Yeah. The plan for Salloum, once we've established a success following the drilling and analysis of the results, is to plan a tieback to the nearby Rhemoura TPS facilities. This will require the laying of a pipeline back to that facility. The design and execution of that program of work is likely to take a number of months.
I think it's fair to say that we are already working on the planning and the engineering of that particular pipeline laying, so we can plan for that success. In terms of the liftings, Teodor, I'll take that one. I think in the gory detail of our report, we try and be as transparent as we can in terms of the lifting frequency. In Gabon, we had a lifting in July. We anticipate the next partner lifting in November. There is a state lifting in between, which is why there's a little bit of a gap there. The state lift their own barrels. The GOC and the state occasionally get a lifting, and they will opt to take that lifting during the month of September. In Tunisia, we have had a lifting in July, and we will have another lifting we anticipate in the fourth quarter.
Those are, of course, supplemented by some of the domestic sales. The sort of big hits on the revenue are the big international liftings. In the meantime, we have regular domestic sales as well, which add to that. At Aje, at the moment, we don't have a clear lifting schedule, but we definitely anticipate one, possibly as many as two liftings. Exactly where they will fall quarter to quarter, I'm not entirely sure. That's why we prefer to kind of look at this on a half yearly basis if we can. I would expect that we would have five to six international liftings during the second half of the year, and I would expect that to be supplemented by, again, the domestic sales in Tunisia.
Okay. Thank you.
Before we take the next question, please be reminded, if you'd like to ask a question via the phone lines, please press star one on your telephone keypads. The next question comes from the line of Eivind Svensson, private investor. Please go ahead.
Thank you for a nice presentation and for taking my question. I have a few questions regarding Dussafu and one question regarding Aje, then some regarding some growth opportunities. Dussafu first. In your corporate presentation in January this year, Panoro presented a gross prospective resource regarding prospects A and B of 482 million barrels. In the latest investor presentation from BW Energy, they have a P 50 prospective resource of A and B combined of 89 million barrels. This is a reduction of more than 300 million barrels, 62% reduction. Does Pan and BW Energy have different views regarding these prospects? What has changed since January that explains this massive negative adjustment?
Okay. Should we take that question first, Eivind? Thank you very much, as usual, for your very good questions. Richard, do you want to talk a little bit about the prospect A and B and the discrepancy in those numbers?
Sure. The prospects A and B, just to remind you, are two large structures to the south of the Ruche discovery. They were identified on 3D seismic data and mapped. They've been in our prospects inventory for a number of years. Our early view on those was that they could have a high pace in the order of 200 million barrels each prospect. We still believe that could be true. There are certain things required for that to be the case. Obviously, we'll test that with a drilling campaign that needs to be designed and targeted to find out what the actual potential reserves are there.
The work done by BW, where they've shown a slightly lower number, a mid case of 89 million barrels, is based on taking data from the Ruche North East discovery, which is new data for the Dentale reservoirs, and also from the development and appraisal drilling at Tortue, and adding that data to the existing database. They come up with a slightly smaller number than ours. Our view is in a high case, it could still be towards that higher end of that range, but it is a range. With exploration prospects, you expect a great deal of uncertainty around what the final answer will be. Yeah, the BW numbers are coming out slightly lower than we had published earlier in the life of the joint venture.
I think the only thing I'd add, Eivind, is that obviously we're the non-operator here. We, of course, form our own views, and I think you can hear from Richard that we're still quite bullish on prospects A and B. We are a bit guided in terms of the official numbers by the operator. We, together with the previous operator, held those numbers. BW are entitled, obviously, as operator also to have their own view on these assets. Those should probably be treated as the official numbers. We are not backing off of the previous assessments that have been made.
Thank you. Do you have located the exploration well coming up after the drilling for the four new production well? Do we see Tullow farming closing in Q3?
I'll answer on the exploration well. We haven't picked a prospect for that yet. That's something that we've got workshops coming up to look at that. We're actually reprocessing the seismic data over the whole area, and that's going to inform us where we drill. It will also help refine our position on the prospect B. It's very important that we get a good image on prospect B, and that will refine what we think of the volumetrics and the chance of success of that prospect. That will follow after the development drilling phase.
I think that prospect will be picked probably around the turn of the year, would be my guess, Eivind. That's not an official number, but it's still a few months away until we await the results of the reprocessed seismic and the workshops that will follow from there. In respect of Tullow and the back-end right that they have, discussions are well underway. There's quite a bit of documentation that goes with this, and those discussions are ongoing. We do expect Tullow to formally back in. That's our expectation. It's not yet concluded.
Did you have a last question?
Yeah. Regarding Aje. The FPSO Front Puffin has been sold to Century.
Yes.
Aje joint venture did terminate the FPSO contract with the effective date in June, July this year. Is there a new contract in place regarding the lease of the Front Puffin? Have the partnership succeeded in negotiating better terms? Will we see some progress on Aje this year?
Okay. Well, I will touch on the contract, obviously, underlying commercial contracts are of a sensitive nature. When people ask me about that sale of the Puffin, obviously we would make a press release if there's anything materially different. The termination was simply a contractual obligation that we had to terminate the contract, otherwise we would've been locked in for a different set of assumptions. We had a high expectation that things would continue as normal. For us, everything is business as normal with Century. Century have always been the O&M provider on the vessel anyway. They now own it. Again, for all intents and purposes, it's business as usual at Aje. The second question on Aje was Sorry?
Will we see some progress on Aje this year?
Yes. No, I'm glad you asked the question. I realize our presentation material doesn't have terribly much information on Aje. With Aje, I'll say the same things that we pretty much say at every quarterly call, which is, in Panoro's view, there is an enormous opportunity at Aje on the development of the Turonian gaps. What we believe needs to happen is that the joint venture needs to be restructured. At first, we have a lot of partners, all with coming at things from different directions. We believe there needs to be a consolidation or a restructuring of the joint venture, which would help unlock the next phase of the development at Aje. There are always discussions going on. If there were anything newsworthy, I would, of course, have to put it in our second quarter results.
We continue to discuss with the joint venture and with our partners ways of bringing this project forward, and that continues to be the case.
Thank you.
The next question comes from the line of Cedric Smith, private investor. Please go ahead.
Yes, good morning, guys. Thanks for a good presentation. I have two questions related to exploration prospects. One is related to the Hibiscus Up Dip prospect. I guess it's Richard, if you could just give a little bit more of an explanation on how you're drilling it compared to the '91 well that was under. Just give us a little bit more of an explanation around that. The second one is related to the Habara prospect in Tunisia, which is in the block, which I don't remember the name of, but which is outside of TPS assets. From my research, the Habara prospect is quite significant and has a high potential. Maybe you could give us a little bit more information on that. That's my two questions. Thank you.
Thanks, Cedric. Yeah, Richard, do you want to take the questions?
Yeah, I will. Okay, thanks, Cedric. Good question on Hibiscus Up Dip. There was a well drilled in 1991 by ARCO. That well was drilled on 2D seismic data. It's important to note that. It was a rather poor subsurface image. When it was drilled by ARCO, they didn't have the benefit of our current 3D. If you recall, the 3D has enabled us to get success at both Ruche and Tortue, so we have that additional technology and data that wasn't available in the 1991 drilling. The 1991 well found very good quality reservoir in the Gamba. The well was cored, and there was live oil shows in core. It actually tested water. The interpretation of that is that it was drilled through a transition zone, so probably at the edge of a valid structure.
From the 3D seismic, we believe that the valid structure is there. It exists to the southwest of the 1991 well, and that's where the current drilling is taking place. The well is a vertical well. It's relatively quick to drill it, and we're taking this opportunity to do that ahead of the development drilling to warm the rig up, get that exploration well in, add resources into the Ruche and Ruche Northeast area, in the event of success. We should have some results on that campaign coming out in September. Moving on to Habara. Frederick, you're right. There is a prospect in the Sfax Offshore Exploration Permit called Habara. This has been identified a number of years ago by former operators. It's covered by some quite poor quality 2D seismic data currently. We believe it to be a valid structure.
It's just offshore the Guebiba structure, so a similar kind of trend to Guebiba in TPS, and it could be easily tied back into that infrastructure as we're contemplating to do with Salloum. It does require us to acquire some additional seismic data to enable to drill and develop that prospect. We're planning, in the event that we enter the next phase on Salloum exploration permit, to acquire some seismic in 2020, which would enable us to drill the prospect in 2020, 2021. That's the timeframe looking forward for that.
Yeah, Frederick, just to add, if you remember some of the slides we show on the Sfax offshore permit. It is quite a big permit, and there are a number of discoveries there, Jawahra, Ras El Besh, a number of exploration prospects of which Habara is one. I think Habara is the one that kind of excites people because it is right on trend with Guebiba, as Richard said. It is right close to shore, so it is one of those ones that is easily tied back. I think would almost certainly feature as the key exploration well in the next phase, almost certainly.
Yeah. The proximity to infrastructure kind of caught my interest. Well, thank you for your answers. Appreciate it. Thank you.
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Thank you very much, Molly. Thank you very much for the questions. Thanks to you who listened. If you have any additional questions that you don't want to ask in the full public view, please feel free to email us on our emails or on our information email address, which you can find on our website. We thank you very much for listening, and we look forward to updating you in the near future on developments at Panoro. Thank you.
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