15th Sep 2008 16:38
Emerald Energy Plc
15 September 2008
Peru - Block 163, 2008 Bidding Round Result
Emerald Energy Plc ("Emerald" or the "Company") would like to provide the following update on operations in South America.
The Company has been informed by Perupetro S.A., the state company administering the hydrocarbon resources in Peru, that it was the successful bidder on Block 163 in the recently completed 2008 Bidding Round.
Block 163 is located in the Ucayali basin, approximately 440 kilometres to the northeast of Peru´s capital, Lima, and has an area of approximately 5,000 square kilometres. The block is in an area containing gas and oil fields producing from Cretaceous aged formations and is traversed by pipelines to a refinery in Pucallpa, the capital of the province. Several leads with depths estimated to be between 9,000 and 12,000 feet have been identified from the existing sparse 2D seismic data.
The work commitment during the first phase of the exploration and production ("E&P") contract, lasting 12 months, consists of technical studies. The second phase of 18 months, if entered, has a minimum work commitment of 300 kilometres of 2D seismic acquisition and processing, and the third phase of 18 months, if entered, has a minimum work commitment of one exploration well. The E&P contract is a tax/royalty contract in which the royalty, including additional royalty as part of the bidding process, is 13% up to 5,000 barrels per day increasing up to 28% for production levels in excess of 100,000 barrels per day.
Subject to completion of the award process, Emerald will hold 100% interest and operatorship of Block 163, Emerald's first exploration block in Peru.
Emeralds' Chief Executive Officer, Angus MacAskill, said:
"We are very pleased to have been the successful bidder in Block 163, marking our entry into Peru, and we look forward future success and growth in this Andean country"
Enquiries: Lisa Hibberd 020 7925 2440
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