Ireland-based energy company Petroceltic has started development drilling on its Ain Tsila gas and condensate field in Algeria and is preparing to tender an engineering, procurement and construction (EPC) contract.

Drilling started on 21 February, according to a statement published by Petroceltic on 22 Feburary.

The well, called AT-10, is located in the north of the field approximately 3.4 kilometres from the field discovery well AT-1, and 2km from the appraisal well AT-8.

AT-10 is a vertical well targeting the Ordovician reservoir formation. Petroceltic is planning to drill to a total depth of 1,989 metres.

Petroceltic says the well is the first of up to 24 development wells expected to be required to establish and maintain an annual average wet gas plateau rate of 355 million cubic feet a day (cf/d).

The company says it is also preparing to tender the EPC contract for the field development project.

The project is estimated to be worth $2bn.

Four bidders have prequalified for the contract:

“We are collaborating with our partners on a number of opportunities to reduce overall development risk and enhance long term-field recovery and value, and these will be progressed in parallel with the EPC award process,” says Brian O’Cathain, CEO of Petroceltic.

Petroceltic holds a 38.25 per cent interest in the Ain Tsila asset. Sonatrach holds a 43.375 per cent interest and Enel holds an 18.375 per cent interest.

The Ain Tsila gas field is located in the Illizi basin, within the Isarene permit in Blocks 228 and 229a.