LONDON, January 26 /PRNewswire/ -- 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 provide the following update on the Company's operations at Block 26, Syria where Gulfsands holds a 50% interest and acts as operator.
Application to Develop the Yousefieh Oil Field Granted by Syrian Authorities
Discovery of oil at Yousefieh-1, located approximately 3 kilometres east of the Khurbet East Field, was made in November 2008, with two subsequent appraisal wells being drilled in 2009.
Gulfsands has now received confirmation from Syria's General Petroleum Corporation that Gulfsands Petroleum Syria Limited has been granted permission to develop the Yousefieh Oil Field accumulation in Block 26 North East Syria. A production license of 25 years duration has been granted, with the possibility of an extension if required, for a further 10 years.
The Yousefieh Field was assessed at the end of 2008 as containing gross proved plus probable reserves of 11 million barrels of oil. A further update on Yousefieh Field estimated gross reserves will be provided at the beginning of the second quarter 2010.
First oil from Yousefieh is anticipated early in April 2010. Production will commence from 2 wells, Yousefieh-1 and Yousefieh-3, at an expected initial combined rate of up to 1000 barrels of oil per day (bopd).
Production from the wells will be closely monitored to assess flow performance and to determine whether the Yousefieh reservoir benefits from the same strong aquifer pressure support as is observed in the nearby Khurbet East Field. The current expectation is that the Yousefieh field has lower reservoir energy than Khurbet East and planning is underway to install permanent down-hole artificial lift equipment in both Yousefieh wells later in the year. In addition, a further development well on Yousefieh is planned for 2010.
It is anticipated that production from the Yousefieh Field will reach a rate of approximately 6000 barrels of oil per day by 2012.
Ric Malcolm, Gulfsands CEO, said
We are delighted to have received the Syrian Government's early confirmation of development approval for the Yousefieh field and now look forward to commencing production as soon as practicable. The early production data obtained will provide valuable information that will assist us in optimizing the development of the field.
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.
Gulfsands is listed on the AIM market of the London Stock Exchange.
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 17,300 barrels of oil per day through an early production facility. Block 26 covers approximately 8,250 square kilometres 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 2010 and is extendable for a further two years. Gulfsands' working interest 2P reserves in Syria at 31 December 2008 were 35.2 mmbbls.
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 44 blocks comprising approximately 138,000 gross acres offshore Texas and Louisiana, which include 30 producing oil and gas fields with proved and probable working interest reserves at 31 December 2008 of 5.1 mmboe.
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 http://www.gulfsands.com
SOURCE: Gulfsands Petroleum Syria
CONTACT: Gulfsands Petroleum (London): Richard Malcolm, Chief ExecutiveOfficer, +44(0)20-7434-6060; Richard Malcolm, Chief Executive Officer,Kenneth Judge, Director of Corporate Development Communications,+44(0)7733-001-002 ; Buchanan Communications Limited (London): Bobby Morse,Ben Romney, +44(0)20-7466-5000; RBC Capital Markets (London): JoshCritchley , Matthew Coakes, Brett Jacobs, Martin Eales, +44(0)20-7653-4000