Statement re Disposal of Three Gulf of Mexico P...
Immediate Release                             22(nd)  December, 2010
GULFSANDS PETROLEUM PLC
Disposal of Three Gulf of Mexico Properties
London, 22(nd) December, 2010:Â 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, Tunisia, Italy and the
U.S.A., is pleased to announce the sale of three properties from the Company's
Gulf of Mexico asset portfolio.
These non-core producing properties are located in the shallow water shelf area
of the Gulf of Mexico and the disposal is a part of the Company's ongoing plans
to rationalize its US oil and gas property portfolio. The properties include
various working interests in the Eugene Island 57/58 (EI 57/58) gas field, the
Vermillion 379 (VR 379) oil and gas field and the South Pelto 13 (PL13) oil and
gas field. The transaction has an effective date of 1(st) May, 2010 and a sale
price of US$4.2 million prior to closing adjustments. Completion of the
transaction is expected to occur in late January 2011.
These properties are considered non-core due to either their production being
dominated by natural gas (EI 57/58) or their relatively low working interest
positions (VR 379 and PL 13). Â Â In addition to receipt of the cash
consideration, the sale of these properties removes the Company's forward
liability provision related to the decommissioning (plugging and abandonment of
wells, decommissioning of facilities on these licences) and therefore the
Company will be returned cash deposits that are currently held in escrow as
security against these future liabilities. The amount of cash deposits expected
to be returned will be approximately US$5.6 million.
The Company's pro forma proved and probable US working interest reserves at 31
December 2009, adjusted for this disposal, were 3.4 mmboe compared with 4.7
mmboe prior to the disposal.
This release has been approved by Richard Malcolm, Chief Executive of Gulfsands
Petroleum Plc who has a Bachelor of Science degree in Geology with 30 years of
experience in petroleum exploration and management. Mr. Malcolm 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)Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â +44 (0)20
7434 6060
Richard Malcolm, Chief Executive Officer
Andrew Rose, Chief Financial Officer
Kenneth Judge, Director: Corporate Development & Communications
Buchanan Communications Limited (London)Â Â Â Â Â Â Â Â Â +44 (0)20 7466 5000
Bobby Morse
Ben Romney
Chris McMahon
RBC Capital Markets (London)Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â +44 (0)20 7653 4000
Josh Critchley
Matthew Coakes
Martin Eales
ABOUT GULFSANDS:
Gulfsands is listed on the AIM market of the London Stock Exchange.
Syria
Gulfsands owns a 50% working interest and is operator of Block 26 in North East
Syria. The Khurbet East oil field was discovered in June 2007 and commenced
commercial production within 13 months of the discovery. This field is producing
at an average gross production rate of approximately 18,000 barrels of oil per
day through an early production facility. A second field discovery, the
Yousefieh field, was brought on-stream in April 2010, and is currently producing
approximately 3,000 barrels of oil per day. Block 26 covers approximately 5,414
km(2) and encompasses existing fields which currently produce over 100,000
barrels of oil per day, and are operated mainly by the Syrian Petroleum
Company. The current exploration license expires in August 2012. Gulfsands'
working interest 2P reserves in Syria at 31 December 2009 were 46.0 mmbbls.
Tunisia
Gulfsands is acquiring working interest positions in two exploration permits in
Tunisia (Chorbane and Kerkouane Permits) and one exploration permit in Southern
Italy (G.R15.PU) from ADX Energy Ltd the operator of all three permits. The
Company's interest in these permits remains subject to the completion of the
Company's farm obligations and various approvals from the governments of Tunisia
and Italy.
Kerkouane Permit - Offshore Tunisia
G.R15.PU Permit (Pantelleria Permit) - Offshore Italy
G.R15.PU, is located offshore the island of Pantelleria southwest of Sicily in
Italian waters and the Kerkouane Permit is located offshore northeast Tunisia.
The two permits are contiguous and comprise a total area of approximately 4,500
km(2).
The operator has identified multiple leads and targets on these permits.
Drilling operations were recently completed at the Lambouka-1 well where gas was
encountered in the Abiod Formation. However, as a result of down-hole problems,
no fluid samples or gas flow were established. The well was suspended with the
intention of re-entering at a later date and drilling and testing the reservoir
in a sidetrack hole up-dip of the existing discovery.
Gulfsands has completed its earn commitments with respect to the Kerkouane and
Pantelleria Permits with the drilling of the Lambouka-1 well. Gulfsands has
earned a 30% working interest in both permits by paying approximately 35% of the
cost the Lambouka-1 well and reimbursing the operator for a portion of various
pre-drill costs that include a recently completed 3D seismic programme.
Chorbane Permit - Onshore Tunisia
The Chorbane permit is located in central Tunisia and covers an area of 2,428
km(2). The permit is surrounded by several producing oil fields and extensive
oil & gas infrastructure. Gulfsands' forward work commitment for the Chorbane
permit includes the drilling of one exploration well in the first quarter of
2011 for which Gulfsands will pay 80% of the estimate US$6 million cost of the
first exploration well so as to earn a 40% interest in the permit.
A number of prospects and leads have been indentified within the permit, the
most prospective being a large tilted horst block ("Sidi Daher") where the
operator has identified multiple potential targets estimated to hold recoverable
mean un-risked prospective resources of 60 mmboe.
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, following completion
of a feasibility study on the project, and is negotiating details of a
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. The Company is
actively engaged in discussions with respect to financing and potential equity
partners. Gulfsands has no reserves in Iraq.
Gulf of Mexico, USA
The Company owns interests in 32 leases offshore Texas and Louisiana, which
include 20 producing oil and gas fields with proved and probable working
interest reserves at 31 December 2009 of 3.4 mmboe (figures adjusted for the
disposal of non-core properties in December 2010).
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.com
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Gulfsands Petroleum PLC via Thomson Reuters ONE
[HUG#1474856]
Latest directors dealings
- 1 day ago Savannah Energy
- 1 day ago Buccaneer Energy PLC
- 1 day ago Savannah Energy
- 1 day ago Carclo
- 1 day ago Schroder Japan Growth Fund