Khurbet East Update
Immediate Release 13 May 2008
Gulfsands Petroleum plc
First horizontal development well successfully completed in Khurbet
East Field
London, 13th May 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 completed
the drilling operations on the first horizontal development well
within the Khurbet East Field ("KHE-5H"). The KHE-5H well, which
flowed oil to surface at an average rate of 2041 barrels of oil per
day ("bopd") through a 3/8" choke, has been completed and suspended
as the fourth oil producer for connection through the Early
Production Facility ("EPF"), scheduled to commence operation by the
fourth quarter of 2008.
The KHE-5H well was designed to be drilled and completed as a
horizontal producer within the Cretaceous Massive Reservoir ("Massive
Reservoir") in the Khurbet East Field. The top of the reservoir was
encountered within 1 metre of the pre-drill estimate and the well was
drilled through a total horizontal section of 300 metres within the
reservoir. The well flowed oil to surface at an average rate of 2041
bopd through a 3/8" choke during the final 6 hour flow period.
Analyses of data from bottom-hole gauges indicate that these rates
were achieved with less than 10 psi pressure drawdown at the
reservoir. Preliminary analysis of the downhole pressure data
indicates the same excellent reservoir properties as seen in the
other Khurbet East wells.
The production information obtained from the KHE-5H well and the
vertical production wells within the Massive Reservoir in the Field
(KHE-2, KHE-3 and KHE-4) during the EPF phase will be valuable for
planning and optimising the design and construction of the Khurbet
East permanent production facility.
The Company has plans to drill at least one additional horizontal
production well within the Field in the near term for tie-in to the
EPF. This will provide the Company with 3 vertical and 2 horizontal
producing wells from the Massive Reservoir at Khurbet East during the
EPF stage.
Gulfsands' Executive Chairman, Andrew West, said:
"We are pleased with the results achieved from the Company's first
horizontal development well which continues our record of successful
drilling of the Khurbet East oil field. With a further horizontal
well to be spudded imminently, Gulfsands is on track to commence
commercial production later this year."
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.
For more information please contact:
Gulfsands Petroleum (London) +44 (0)20-7182-4016
Kenneth Judge, Director of Corporate Development +44 (0)7733-001-002
Buchanan Communications Limited (London) +44 (0)20-7466-5000
Bobby Morse
Nick Melson
RBC Capital Markets (London) +44 (0)20-7653 4804
Andrew K. Smith
Sarah Wharry
ABOUT GULFSANDS:
Gulfsands is listed on AIM.
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.
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 48 offshore blocks comprising
approximately 168,000 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 2007 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 2007 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.
More information can be found on the Company's website
www.gulfsands.net.
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