Khurbet East Field Development Update
First Khurbet East development well successfully completed
Horizontal development well scheduled to commence in Khurbet East
London, 6th March 2008: Gulfsands Petroleum plc ("Gulfsands", the
"Group" or the "Company" - AIM: GPX), the oil and gas production,
exploration and development company with activities in Syria, Iraq,
and the U.S.A., is pleased to announce that the Company has
successfully completed the drilling of its first development well
within the Khurbet East Field ("KHE-4") following the recent approval
by the Syrian Government for the development of the Khurbet East
Field.
The KHE-4 well was drilled to a total depth of approximately 1,935
metres, and the top of the reservoir section was encountered within 3
meters of the pre-drill prognosis. The well has now been completed
and suspended as a future oil producer, and will be brought on line
when the Khurbet East Early Production Facility is operational,
scheduled to commence by Q4 2008. As planned, the Company did not
undertake a drill-stem test with this well as the tests from the
KHE-2 and KHE-3 wells provide sufficient information for the vertical
wells in this portion of the Field. As previously announced, a drill
stem test on the KHE-3 appraisal well produced at an average
stabilized rate of 3,420 bopd with 206,000 cubic feet of natural gas
per day.
The KHE-4 well is the first development well within the Khurbet East
Field, and is designed to deliver oil production from the Cretaceous
Massive Formation reservoir. KHE-4 is a vertical well located near
the currently mapped crest of the structure.
Drilling operations on KHE-4 were completed ahead of schedule and
under budget, which is a significant achievement for the first
development well in the Field. The next development well in the
Field, KHE-5H, is designed and will be completed as the first
horizontal well within the Massive Formation reservoir. Drilling
operations on KHE-5H are expected to commence in mid-March 2008.
Gulfsands' CEO, John Dorrier, said:
"KHE-4 is the first development well in the field. We have planned
an aggressive programme of drilling and early production for the
balance of 2008, and look forward to updating the market on its
progress."
This release has been approved by Jason Oden, Gulfsands Exploration
Manager, who has a Bachelor of Science degree in Geophysics with 23
years of experience in petroleum exploration and management and is
registered as a Professional Geophysicist. Mr. Oden has consented to
the inclusion of the technical information in this release in the
form and context in which it appears.
ABOUT GULFSANDS:
Syria
Gulfsands owns a 50% working interest and is operator of Block 26 in
North East Syria. Block 26 covers approximately 8,250 square
kilometres and encompasses existing fields which currently produce
over 100,000 barrels of oil per day. These fields are operated mainly
by the Syria Petroleum Company. In the first half of 2007 Gulfsands
announced an oil and gas discovery on Block 26 called Khurbet East.
This discovery is currently under development with first production
targeted for the fourth quarter of 2008. On 23 August 2007, the
Company initiated the first extension period of exploration on Block
26 for a further period of three years. The Company has also formed
a strategic partnership with Cham Holding for acquiring oil and gas
projects in Syria and Iraq.
Iraq
Gulfsands signed a Memorandum of Understanding in January 2005 with
the Ministry of Oil in Iraq for the Maysan Gas Project in Southern
Iraq and following completion of a feasibility study on the project
is negotiating details of definitive contract for this regionally
important development. The project will gather, process and transmit
natural gas that is currently a waste by-product of oil production
and as a result of the present practice of gas flaring, contributes
to significant environmental damage in the region.
Gulf of Mexico, USA
The Company owns interests in 54 offshore blocks comprising
approximately 193,000 gross acres which includes numerous producing
oil and gas fields offshore Texas and Louisiana with proved and
probable recoverable reserves net to Gulfsands at 31 December 2006 of
41.5 BCFGE (6.9 MMBOE), consisting of 27.3 BCFG and 2.36 MMBO.
Onshore USA
Gulfsands owns interests in two oil and gas fields onshore Texas, USA
(98.5% working interest in Emily Hawes Field and 37.5% working
interest in Barb Mag Field) with proved and probable recoverable
reserves net to Gulfsands at 31 December 2006 of 3.1 BCFGE (0.5
MMBOE), consisting of 2.8 BCFG and 57,000 barrels of oil.
Certain statements included herein constitute "forward-looking
statements" within the meaning of applicable securities legislation.
These forward-looking statements are based on certain assumptions
made by Gulfsands and as such are not a guarantee of future
performance. Actual results could differ materially from those
expressed or implied in such forward-looking statements due to
factors such as general economic and market conditions, increased
costs of production or a decline in oil and gas prices. Gulfsands is
under no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise, except as required by applicable laws.
For further information, please refer to the Company's website
www.gulfsands.net or contact:
Gulfsands Petroleum (Houston) + 1-713-626-9564
John Dorrier, Chief Executive Officer
David DeCort, Chief Financial Officer
Gulfsands Petroleum (London) +44 (0)20-7182-4016
Kenneth Judge, Director of Corporate Development +44 (0)7733-001-002
Gulfsands Petroleum (Syria) +963-9-8888-7788
Mahdi Sajjad, President
Buchanan Communications Limited (London) +44 (0)20-7466-5000
Bobby Morse
Ben Willey
Nick Melson
RBC Capital Markets (London) +44 (0)20-7029 7882
Andrew K. Smith
Sarah Wharry
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