Statement re Tunisia Operations Update, Kerkoua...
Immediate Release 18 January 2011
GULFSANDS PETROLEUM PLC
Tunisia Operations Update
Kerkouane Licence Renewal
London, 18th January, 2011: 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 that ADX Energy Ltd ("ADX Energy" - ASX:ADX) the
operator of the Kerkouane Exploration Licence offshore Tunisia (Kerkouane
Licence) and the adjacent Pantelleria Exploration Permit in Southern Italy
(G.R15.PU, known as the Pantelleria Permit) has provided the following update on
the renewal of the Kerkouane Licence.
ADX Energy on behalf of the Kerkouane Joint Venture participants has announced
that the Government of Tunisia has approved the renewal of the Kerkouane
exploration licence ("permis de recherche d'hydrocarbures") and has granted
three more years for exploration and appraisal activities, until 22 February
2014. Â At that point, the exploration licence can then be renewed for another
three years.
The following work programme is included within the terms of the three year
renewal:
-A well test of the Lambouka discovery
-Â Â Â Â Drill a well to a minimum depth of 2500 meters, or drill a well to the
Jurassic aged
      reservoir level in case such a target is a viable economic prospect
and can be identified
      on the newly acquired dual sensor 3D seismic data
-Relinquish 772 km2 of the original licence area. Â After this relinquishment,
the
      Kerkouane licence comprises 3080 km2.
The current licence contains a number of appraisal and exploration targets such
as
-The Dougga gas condensate discovery (covered by 3D seismic)
-The Lambouka discovery (covered by 3D seismic)
-The Dougga NW Lead (covered by 3D seismic)
-Newly identified structural/stratigraphic leads within the Pliocene section
(partly
       Covered by 3D seismic)
-Structural leads, typical of a fold and thrust belt, within the northern part
of the licence
      and covered by 2D seismic.
The Kerkouane Joint Venture includes the following participants:
ADX Energy Ltd60% Operator
Gulfsands Petroleum Plc30%
XState Resources Ltd10%
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.
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. Â 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
km2 and encompasses existing fields which currently produce over 100,000 barrels
of oil per day, and are operated mainly by the Syrian Petroleum Company. Â 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
km2.
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
km2. 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 first $5 million in drilling costs, and 40%
of the drilling costs in excess of $5 million, 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 175 billion cubic feet of gas ("bcfg")
and 44 million barrels of oil from Tertiary and Cretaceous aged reservoirs.
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. Â 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. Â 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#1480487]
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