8th Jun 2005 07:00
Gulfsands Petroleum PLC08 June 2005 8 June 2005 Gulfsands Petroleum PLC("Gulfsands" or "the Company") Gulfsands increases Misan Gas Project, Iraq interest to 100% Gulfsands Petroleum (symbol GPX), the AIM listed oil and gas exploration,development and production company with activities in the USA, Syria and Iraq,announces that following the expiry of the initial twelve month period of ajoint venture with Ronexim (a private Russian company), in the Misan GasProject, the Company has acquired Ronexim's 15% interest and now holds 100% ofthe project. On January 5, 2005 Gulfsands Petroleum signed a Memorandum of Understanding withthe Ministry of Oil in Baghdad, Iraq (the "Oil Ministry") for the Misan GasProject located in southern Iraq. The Project will gather, process and transmitnatural gas that is currently a waste by-product of oil production in southernIraq. Currently, since there is no infrastructure to gather and processassociated-gas in these fields, the gas is being burned at the sites of the oilfields. This Project will eliminate the environmentally damaging practice ofgas-flaring in a number of large fields in southern Iraq, and produce a valuableresource of clean natural gas that can be used to generate much neededelectricity for Iraqis. Gulfsands has completed a Feasibility Study in cooperation with the OilMinistry; the plan is to build the project in two phases. The first phase isexpected to take approximately three years to complete and the second phase, afurther two years. This Project involves the engineering, design, procurement,construction and operation of an associated natural gas gathering system, aNatural Gas Liquids ("NGL") plant, and product transmission pipelines. TheProject is expected to produce approximately 46,600 barrels of NGL per day and338 million cubic feet of dry sweet natural gas per day. As well as the benefit to the Iraqi economy and environment, the Project is alsoexpected to employ many local Iraqis. Transfer of technology and training arealso key elements of the plan. The Project is believed to be the first largeinfrastructure project undertaken by private international investment in Iraqsince the end of the conflict in May 2003. Gulfsands' CEO, John Dorrier, said: "The Misan Gas Project is the first step in Gulfsands' plan to grow itsoperations in Iraq in conjunction with the country's economic recovery. TheProject is designed to provide clean natural gas to displace fuel oil currentlyburned to generate electricity. The Project also will provide employment andtraining opportunities for Iraqis both during its construction and its ongoingoperating phase. This Project and others like it will play a key role inexpanding Iraqi oil production in the future". Enquiries: Gulfsands Petroleum (Houston) 713-626-9564David DeCort, Chief Financial Officer College Hill (London) 020-7457-2020Ben Brewerton / Jim Joseph Seymour Pierce (London) 020-7107-8000Richard RedmayneJonathan Wright Note to Editors • Gulf of Mexico, USA The Company has a 52.6% interest in Northstar Gulfsands, which owns interests in39 producing oil and gas fields offshore Texas and Louisiana and operates 8 ofthose fields. Northstar Gulfsands has proved and probable reserves of 4.7 mmbblsof oil and some 29.2 bcf of gas as of November 1, 2004. • Syria In Syria, Gulfsands owns a 50% working interest in Block 26 and is the operator.The block covers 11,000 sq kms and surrounds areas which currently produce over100,000 bopd from existing fields. The Company is planning the acquisition ofan extensive 2D seismic programme and the drilling of the first well during2005. Gulfsands has identified 27 exploitation and exploration prospects andleads with mean resources potential of 1 billion barrels of recoverable oil. • Iraq Gulfsands has recently signed a Memorandum of Understanding with the Ministry ofOil in Iraq for the Misan Gas Project in Southern Iraq and is currentlynegotiating the definitive contract for the project. The project will gather,process and transmit natural gas that is currently a waste by-product of oilproduction in the region and will end the environmentally damaging practice ofgas flaring. Gulfsands has completed a feasibility study and expects to conductfurther technical work and commercial discussions with the Iraq Oil Ministry inthe first half of 2005. • Onshore USA At the Emily Hawes field, which has previously produced approximately 1.7 bcf ofnatural gas before being shut-in, gas production is expected to start during thesummer of 2005. The first well in the Barb Mag oil field is expected to bedrilled in the third quarter of 2005. Darcy Energy has a 25% and 37.5% workinginterest in these fields respectively. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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