CALGARY, Canada, May 14 /PRNewswire/ --
- Potential Farm-in for 50 Per Cent Interest of Ogueyi Licence Area Including Currently Drilling Azango Exploration Well
Addax Petroleum Corporation (Addax Petroleum or the Corporation) ( TSX: AXC and LSE: AXC) today announced that it has agreed to fund an exploration well in the Ogueyi licence area, onshore Gabon, with the potential to earn a 50 per cent interest in the licence area. Perenco, as operator of the Ogueyi licence area, has recently spudded the exploration well targeting the Azango prospect.
Commenting, Jean Claude Gandur, President and Chief Executive Officer of Addax Petroleum said: We are pleased to have acquired a potential interest in the Ogueyi licence area as this continues our strategy to build our property portfolio around core producing areas. This is also a demonstration of Addax Petroleum's commitment and concerted focus on growth from exploration and provides good potential for an almost immediate impact to the Corporation.
The Ogueyi licence area is an exploration block with a gross area of 1 ,339 km(2) (330,900 acres) on the eastern edge of the Port Gentil basin, onshore Gabon. The Port Gentil basin is a well-established hydrocarbon province, producing mainly offshore from post salt formations of late Cretaceous age. The operator of the Ogueyi licence area has identified several prospects and leads on the block which is covered by a suite of approximately 2,551 km of 2D seismic data. The Azango prospect in the Ogueyi licence area was spudded in early May 2009 and is expected to reach a total depth of 1,685 metres in June 2009.
Operations for the Ogueyi licence area are conducted under a production sharing contract with fiscal terms similar to the other licence areas which Addax Petroleum holds in Gabon. The production sharing contract is in its second exploration phase due to expire in July 2009, however, a two year extension has already been negotiated by the operator. The commitments under the second exploration phase will be fulfilled with the drilling of the Azango prospect.
Under the terms of the farm-in with Perenco, Addax Petroleum has agreed to fund the Azango exploration well up to a maximum cost of US$8 million. In addition, Addax Petroleum has the option to make additional staged payments to Perenco based on future exploration results in order to obtain a 50 per cent interest in the licence area. The ultimate assignment of the 50 per cent interest by Perenco to Addax Petroleum would be subject to the approval of the Government of Gabon. The Government of Gabon also retains a 10 per cent back-in right in the event of a commercial development.
About Addax Petroleum
Addax Petroleum is an international oil and gas exploration and production company with a strategic focus on West Africa and the Middle East. Addax Petroleum is one of the largest independent oil producers in West Africa and has increased its crude oil production from an average of 8 .8 Mbbl/d for 1998 to an average of 134.7 Mbbl/d for the first quarter of 2009. Further information about Addax Petroleum is available at http://www.addaxpetroleum.com or at http://www.sedar.com.
Reader Advisory Regarding Forward-Looking Information
Certain statements contained in this news release, including statements related to drilling plans, development plans and schedules, future seismic activity, production levels and sources of growth thereof, results of exploration activities and dates that areas may come on-stream, future capital expenditures, business strategy and goals, and statements that contain words such as may, will, would, could, should, anticipate, believe, intend, expect, plan, estimate, budget, outlook, propose, project, and statements relating to matters that are not historical fact constitute forward-looking information within the meaning of applicable Canadian securities legislation.
Forward-looking information is subject to known and unknown risks and uncertainties attendant with oil and gas operations, and other factors, which include, but are not limited to: imprecision of reserves and resources estimates; ultimate recovery of reserves; commodity prices; general economic, market and business conditions; industry capacity; competitive action by other companies; refining and market margins; the ability to produce and transport crude oil and natural gas to markets; weather and climate conditions; results of exploration and development drilling and other related activities; fluctuation in interest rates and foreign currency exchange rates; ability of suppliers to meet commitments; actions by governmental authorities, including increases in taxes; decisions or approvals of administrative tribunals; changes in environmental and other regulations; international political events; and expected rates of return. More specifically, production may be affected by exploration success, start-up timing and success, facility reliability, reservoir performance and natural decline rates, water handling and drilling progress. Capital expenditures may be affected by cost pressures associated with new capital projects, including labour and material supply, project management, drilling rig rates and availability and seismic costs.
In this news release the Corporation has made assumptions with respect to the following:
- prices for oil sales; - oil reserves and resource quantities and the discounted present value of future net cash flows from these reserves and the ultimate recoverability of reserves; - timing and amount of future production, forecasts of capital expenditures and the sources of financing thereof; - the amount, nature, timing and effects of capital expenditures; - plans for drilling wells and the timing and location thereof; - expectations regarding the negotiation and performance of contractual rights; - operating and other costs; - business strategies and plans of management; - anticipated benefits and enhanced shareholder value resulting from prospect development and acquisitions; and - treatment under the fiscal terms of Production Sharing Contracts and governmental regulatory regimes.
The Corporation's actual results could differ materially from those anticipated in these forward-looking statements if the assumptions underlying them prove incorrect, or if one or more of the uncertainties or risks described above materializes. Risk factors are discussed in greater detail in filings made by Addax Petroleum with the Canadian provincial securities commissions.
Readers are strongly cautioned that the above list of factors affecting forward-looking information is not exhaustive. Further, forward- looking statements are made as at the date they are given and, except as required by applicable law, Addax Petroleum does not intend, and does not assume any obligation, to update any forward-looking statements, whether as a result of new information or otherwise. The forward-looking statements contained in this new release are expressly qualified by this advisory.
For further information: Mr. Craig Kelly, Investor Relations, Tel.: +41 -(0)-22-702-95-68, firstname.lastname@example.org; Mr. Chad O'Hare, Investor Relations, Tel.: +41-(0)22-702-94-10, chad.o'hare@addaxpetroleum. com; Ms. Marie-Gabrielle Cajoly, Press Relations, Tel.: +41-(0)22-702-94-44 , email@example.com; Mr. Nick Cowling, Press Relations, Tel.: +1-(416)-934-8011, firstname.lastname@example.org, Mr. Mark Antelme, Press Relations, Tel.: +44-(0)20-3178-6242, email@example.com
For further information: Mr. Craig Kelly, Investor Relations, Tel.: +41-(0)-22-702-95-68, firstname.lastname@example.org; Mr. Chad O'Hare, Investor Relations, Tel.: +41-(0)22-702-94-10, email@example.com; Ms. Marie-Gabrielle Cajoly, Press Relations, Tel.: +41-(0)22-702-94-44, firstname.lastname@example.org; Mr. Nick Cowling, Press Relations, Tel.: +1-(416)-934-8011, email@example.com, Mr. Mark Antelme, Press Relations, Tel.: +44-(0)20-3178-6242, firstname.lastname@example.org