![]() Permian Basin, TX ‘38 Gas Flare Deventci R-1 well February, 2011 Bulgaria Overview Exhibit 99.1 |
![]() ![]() ![]() Disclaimer 2 Outlooks, projections, estimates, targets, and business plans in this presentation or any related subsequent discussions are forward-looking statements. Actual future results, including TransAtlantic Petroleum Ltd.’s own production growth and mix; financial results; the amount and mix of capital expenditures; resource additions and recoveries; finding and development costs; project and drilling plans, timing, costs, and capacities; revenue enhancements and cost efficiencies; industry margins; margin enhancements and integration benefits; and the impact of technology could differ materially due to a number of factors. These include changes in long-term oil or gas prices or other market conditions affecting the oil, gas, and petrochemical industries; reservoir performance; timely completion of development projects; war and other political or security disturbances; changes in law or government regulation; the outcome of commercial negotiations; the actions of competitors; unexpected technological developments; the occurrence and duration of economic recessions; unforeseen technical difficulties; and other factors discussed here and under the heading “Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2009 and our Quarterly Reports on Form 10-Qfor the quarters ended March 31, 2010, June 30, 2010 and September 30, 2010 available at our website at www.transatlanticpetroleum.com and www.sec.gov. See also TransAtlantic’s 2009 audited financial statements and the accompanying management discussion and analysis. Forward-looking statements are based on management’s knowledge and reasonable expectations on the date hereof, and we assume no duty to update these statements as of any future date. The information set forth in this presentation does not constitute an offer, solicitation or recommendation to sell or an offer to buy any securities of the Company. The information published herein is provided for informational purposes only. The Company makes no representation that the information and opinions expressed herein are accurate, complete or current. The information contained herein is current as of the date hereof, but may become outdated or subsequently may change. Nothing contained herein constitutes financial, legal, tax, or other advice. Estimates of resources were prepared internally by Direct Petroleum. They have not been audited or evaluated by a third party reservoir engineer. Forward-Looking Statements |
![]() Expansion into Bulgaria and Increased Presence in Morocco (February 3, 2011) – TransAtlantic has entered into an agreement with Direct Acquisition of Direct Bulgaria and the Direct Morocco Subsidiaries Direct Bulgaria 3 “The acquisition of Direct Bulgaria will add significant opportunities for the Company, and geographically it bridges our operations in Turkey and Romania. The deep gas potential evidenced by the Deventci discovery well and the significant shale potential in the Etropole formation provide near- term and long-term catalysts for the Company, without unnecessarily diverting resources from our core assets in Turkey. The addition of the interests in Morocco allows TransAtlantic to consolidate our ability to develop the prospects there,” said Malone Mitchell, the Company’s Chairman. Under the terms of the Purchase Agreement, at closing TransAtlantic Worldwide will pay DPE $2.0 million in cash and the Company will issue to DPE 8,924,478 shares of the Company’s common stock in a private placement. In addition, based on the achievement of three distinct defined milestones (primarily keyed to commercially viable success on certain licenses in Morocco and Bulgaria), DPE would be entitled to receive additional shares of the Company’s common stock with an aggregate value of up to $26.0 million. Upon the closing of the transaction, TransAtlantic will be the parent company of Direct Bulgaria, which owns 100% of the working interests in the A-Lovech exploration license and the Aglen block license, covering an aggregate of approximately 600,000 acres (2,288 square kilometers) in Bulgaria. The A-Lovech license contains the Deventci R-1 well, which discovered a hydrothermal dolomite reservoir in the Jurassic Orzirovo formation at a depth of approximately 4,200 meters. The well is currently producing approximately 250 mcf per day, on a limited test basis, which is processed in a CNG facility adjacent to the Deventci R-1 well. The Company plans to appraise this discovery by drilling a second well, the Deventici-R2, on the A-Lovech license later this year which will be located based upon a recently acquired 3D survey over the discovery area. The A-Lovech license is also estimated to contain over 300,000 acres prospective for Etropole shale (at a depth of approximately 3,800 meters) which was recently certified as a geologic discovery by the Bulgarian government. It is anticipated that coring the Etropole interval in the Deventici R-2 well will greatly enhance the technical understanding of the potential of this shale play. The third established prospective area is a deep gas field on the Aglen block license that produced approximately 9 Bcf before being abandoned in the late 1990s. Petroleum Exploration, Inc. (“DPE”) under which TransAtlantic would acquire 100% ownership of Direct Bulgaria the Direct Morocco Subsidiaries. Closing of the transaction, which is expected to occur by February 15, 2011, is subject to regulatory approvals, approval of DPE’s shareholders and other customary closing conditions. |
![]() Why Bulgaria? Complementary to operations in Turkey and Romania w/o diverting resources Gas Discovery at Deventci R-1 Minimizes Risk Upside from Etropole Shale and Aglen field re- development Attractive for JV Near term Catalyst with Deventci R-2 “Drill Ready” Attractive fiscal terms promoting development of gas resources End user gas prices approximately $10.00 /mcf Royalty 2.5% - 30% (oil) 2.5% - 30% (gas) Tax 10% Large acreage with gas discovery, field re-development and conventional and unconventional upside Close proximity to the existing Bulgarian gas pipeline system Bulgaria imports ~ 90% of its energy from Russia ’09 Average BOPD Consumption 125k Production 3k Net Imports 122k Crude Oil Consumption vs. Production ’09 Average BCF/d Consumption 0.26 Production 0.02 Net Imports 0.24 Natural Gas Consumption vs. Production 4 |
![]() Bulgaria DPE Bulgaria’s license areas are located in close proximity to the existing Bulgarian gas pipeline system cutting across the southeastern portion of the A-Lovech Block. The block is within driving distance from TransAtlantic’s yard in the Thrace Basin. The oil service industry in Romania provides additional access to services and supplies. The port of Varna on the Black Sea is well placed for the importation of materials as is the Danube River. General location of DPE License Area 5 |
![]() A-Lovech Block (Approximately 600,000 acres) 6 |
![]() Seismic Coverage 7 |
![]() ![]() ![]() ![]() ![]() Seismic Type Section Rakita half graben Hydrothermal fluids Carboniferous coals Bachiishte Shale Etropole Shale Aglen Ridge Play Lukovit Prospect Deventci Type Play Ozirovo 8 |
![]() Line seismic near the Deventci R-1 well Denv-1 projection Possible alteration zone 9 |
![]() Koynare Production Concession Contingent Resources* for Deventci Area P(90) 92 Bcfe P(50) 245 Bcfe P(10) 586 Bcfe Structure Map on Top of Ozirovo 10 Deventci Discovery (P90) (P10) (P50) Direct Petroleum has completed the filing for the Koynare Production Concession (“KPC”), covering some 160,000 acres on the A-Lovech Block. The KPC is comprised of the primary development area to be known as Deventci and three prospective resource areas along the geological trend as shown above with the brown labels. Final approval of the KPC is expected late Q1 2011. *Resource evaluation was prepared internally by Direct Petroleum and has not been evaluated by a third party reservoir engineer. |
![]() ![]() ![]() ![]() ![]() ![]() ![]() Planned Koynare/Aglen Pipeline and Proximity to Existing Infrastructure Discovered Gas fields Known structures to be drilled The historical facilities serving the 2 previously producing wells on Aglen have been abandoned including the original gas plant. A new interconnect to the Bulgarian gas transit system is needed as well as modern production facilities Initial Portion of Koynare Production Concession DPE Aglen Field Redevelopment Project 11 |
![]() Etropole Shale Potential 12 |
![]() Etropole Fm Shipkovo mbr Lopjan or Nefela mbr Ozirovo Fm Stefanetz mbr Bukorovtsi mbr Suhundol mbr Borima Fm Dolni Lukovit mbr Perfs in Deventci Gas shows Shale potential Etropole Shale Play 13 30% 49% 21% Clay Carbonates Other |
![]() Aglen Field Re-development 14 |
![]() Structure Map Showing Extent of Aglen Field 15 The Aglen field was originally discovered by the Bulgarians in the late 1980s with the assistance of Soviet oil and gas experts. After the initial two wells drilled on top of the structure proved successful, drilling was continued on the flanks of the structure to establish the gas/water contact. Production from the initial two wells resulted in the production of 9 bcf without the aid of reservoir stimulation or modern production optimization. |
![]() Permian Basin, TX ‘38 Gas Flare Deventci R-1 well Appendix |
![]() ![]() ![]() Bulgaria’s Energy Profile Area 110,879 km2 Comparative Area Slightly larger than Tennessee ‘09 Population Est. 7.58 million ’09 GDP (Nominal) $50.6 billion Fitch Sovereign BBB Stable Risk Rating ‘09 Proved Reserves 15 million BBLS / 0.55 BCF ‘09 Daily Consumption 125k BOPD / 0.33 BCF/d ‘09 Daily Production 3.2k BOPD / 0.02 BCF/d Royalty 2.5% - 30% (oil) 2.5% - 30% (gas) Corporate Tax 10% Oil is sold at world market prices Oil and Gas imports from Russia Only 10% demand met by domestic supply Source: IEA, CIA - The World Fact Book, and IHS 17 Crude Oil Consumption vs. Production 000 BOPD EU Member Natural Gas Consumption vs. Production BCF/d ’09 Average BOPD Consumption 125k Production 3k Net Imports 122k ’09 Average BCF/d Consumption 0.26 Production 0.02 Net Imports 0.24 (see next page) |
![]() Description of Bulgarian Licenses License Holder: DP Bulgaria (100%) Term & Work Program: Prospecting and Exploration Permit for A-Lovech Block • Appraisal extension granted till end of November, 2011. • Each commercial discovery within the block can hold the entire geological trend portion of the block by converting into long term Production Concession. • Application for the Koynare Production Concession was made on 11 November 2010. • Exploration Permit for Aglen Block • Primary term with extensions through April 2014. • Initial work commitments for first 3 years have been fulfilled. • Commitment to drill 2 wells (2,500 meter minimum) in years 4-7 (2010 thru 2014). Production Concessions have a primary term of 35 years with a possible 15 year extension. Royalty:State of Bulgaria Based on “R” factor and calculated by: R=TCR/TCC, where: • TCR is the amount of the total cumulative revenues from the work, connected to the object of concession, for all periods under review, where the paid concession remuneration is deducted • TCC is the amount of total cumulative costs for the work connected to the object of concession (exploration, prospecting, valuation, exploitation, development) for all periods under review. R-Factor DPE has run economic calculations on the royalty percentages for ranges of “R.” These are guidelines only as actual percentages are determined by the Production Concession Bonuses: No bonuses paid during production concession Taxes:Income tax of 10% Royalty - 1.50 2.50% 1.50 1.74 5.00% 1.75 1.99 10.00% 2.00 2.49 12.50% 2.50 2.99 22.50% 3.00 10.00 30.00% R-Factor Range 18 |
![]() 19 Hydrothermal Dolomite This core section from the Aglen R2 shows typical “Zebra” fabric diagnostic of some Hydrothermal Dolomite reservoirs (“HDT”). The black areas are porous reservoir with extensive fracturing also present. |
![]() GEOMETRIES OF HYDROTHERMALLY ALTERED RESERVOIRS From G. Davies and L Smith 2006 20 |
![]() HTD found in the Deventci well Etropole Fm Bachiishte Fm Carboniferous coal Bulgarian Stratigraphic column 21 |