5th Sep 2008 08:04
5 September 2008
ROC OIL COMPANY LIMITED ("ROC")
STOCK EXCHANGE RELEASE
ACTIVITY UPDATE: EQUATORIAL GUINEA
SETTLEMENT OF DISPUTE
ROC advises that, its wholly owned subsidiary, Roc Oil (Equatorial Guinea) Company ("ROC EG") and its co-venturers Atlas Petroleum International Limited ("Atlas") and Osborne Resources Limited ("Osborne") have entered into an agreement to settle the dispute with Pioneer Natural Resources Equatorial Guinea Limited ("Pioneer"), a wholly owned subsidiary of Dallas based Pioneer Natural Resources Company with regard to Blocks H15 and H16 (collectively "Block H"), Offshore Equatorial Guinea.
The dispute related to the 2004 farm-in, whereby Pioneer acquired a 20% interest in the Block H Production Sharing Contract and Joint Venture from ROC.
Key terms of the dispute settlement are as follows:
1. Payment by Pioneer to ROC, Atlas and Osborne of US$5.5 million (ROC net: US$2.75 million);
2. Assignment by Pioneer of its 50% interest in the PSC and under the JVOA to ROC, Atlas and Osborne. As a result, ROC will hold a 37.5% interest in Block H;
3. Pioneer Natural Resources USA Inc. will assign to ROC an option to use the Aban Abraham drilling rig to drill the proposed Aleta-1 well. The rig is currently expected to be available in 2H 2009.
Settlement of the dispute is subject to relevant Government approvals for assignment of the Pioneer interest and satisfaction of conditions in the rig contract relating to assignment of the rig.
Participating Interests in the Block H Joint Venture are:
|
Pre-Settlement |
Post-Settlement |
|
|
ROC EG (Technical Manager) |
18.750% |
37.50% |
|
Atlas (Operator) |
28.125% |
56.25% |
|
Osborne |
3.125% |
6.25% |
|
Pioneer |
50.000% |
- |
Mr Bruce Clement, ROC's Acting Chief Executive Officer stated that:
"ROC views this as a good outcome for all parties. ROC will now seek to bring in a new partner to participate in the drilling of the Aleta prospect, an interpreted Cretaceous channel sand body with stacked potential reservoirs. ROC considers the prospect to have an unrisked mean recoverable reserve potential in the primary target reservoir of the order of 170 million barrels gross ranging up to 500 million barrels gross, if all potential reservoirs are considered, with a series of follow-on prospects and leads."
Matthew Gerber
Manager Investor Relations & External Affairs
For further information please contact:
Mr Bruce Clement
Email: bclement@rocoil.com.au
Or visit ROC's website: www.rocoil.com.au
Dr Kevin Hird
General Manager - Business Development
Tel: +44 (0)20 7495 5707/+61 (0)2 8356 2000
Mob: +44 (0)7751 3671 49/+61 (0)417 261 727
Email: khird@rocoil.com.au
Michael Shaw
Oriel Securities Limited (Nominated Adviser)
Tel: +44 (0)20 7710 7600
Bobby Morse
Buchanan Communications
Tel: + 44 (0)20 7466 5000
Fax: + 44 (0)20 7466 5001
E-Mail: bobbym@buchanan.uk.com
Mob: +44 (0)7802 875 227
In accordance with ASX and AIM Rules, the information in this Release has been reviewed and approved by Mr Neil Seage, Chief Reservoir Engineer, Roc Oil Company Limited, BA, BEng (Hons), MBA and Dip App Fin. Mr Seage, who is a member of the Society of Petroleum Engineers, has more than 30 years of relevant experience within the industry and consents to the information in the form and context in which it appears.
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