Prior to the exploration write down the company had maintained its run of increasing operating profit, up $600,000 from the first half of the year to $7.6 million, more than $3.5 million higher than the corresponding 2002 period. The company's 50% owned Gocerler gas field in Western Turkey also posted a 22% increase in revenue to $10.7 million for the period.
However four failed wells in Turkey cost Amity $7 million and pushed the company back under the red line. The exploration losses were tempered by success at the Adatepe and Cayirdere fields, which are expected to move into full production in the next six months.
The company experienced a year of mixed fortunes in 2003 with the share price hitting historical highs of $1.38 in July after the success of the Adatepe field before slumping to 61 cents last month following the downgrade of the Gorcerler field and the string of dry wells.
Production from the Gocerler gas field, which is operated and 50% owned by Amity, has also started to slowly decline in recent months due to cold winter conditions and declining reservoir pressure in the main producing unit.
This decline will likely continue until the Gocerler-6 infill well is tied in and field compression is installed. The Gocerler-6 infill well will augment production from the upper stratigraphic levels and be in production before the end of May 2004. Compression will most likely be installed by July 2004 and is expected to significantly lift Gocerler production rates.
Amity also spent considerable time and effort exploring the Whicher Range gas field with the Whicher Range-5 well, which suffered numerous technical problems. The company is now waiting to test a fracture simulation program that will determine if a commercial gas flow is possible from the field.
In Turkey, Amity expects production to increase significantly over the next six months as the Adatepe and Cayirdere fields move into full production. Two further development wells will be drilled, one on each of the Adatepe and Gocerler fields.
It is also expected that Amity will drill at least one new exploration well in Thrace over the next six months.
