2nd Jun 2005 07:00
Victoria Oil & Gas PLC02 June 2005 2 June 2005 Tamdykol Oil Project : Farm-Out Agreement • Farm-out agreement signed with NEK Services LLP for development of the Tamdykol oil project, Kazakhstan • US$1.25 million minimum work programme to be entirely funded and performed by NEK • Total potential resource estimates of 34 million barrels of oil Victoria Oil & Gas Plc ("Victoria")(ticker: VOG), today announces the signing ofan exploration agreement between its 90 percent owned subsidiary Olager Oil LLP("Olager") and NEK Services LLP ("NEK"), a Kazakhstani oil company, for thedevelopment of the Tamdykol licence. Tamdykol, an oil project in the AktyubinskOblast of north-west Kazakhstan, has internal C3/D1 category resource estimatesof a potential 34 million barrels of oil. Under the terms of the agreement the minimum work programme for Tamdykol,estimated at US$1.25 million over the next three years, will be conducted andfully financed by NEK. The programme includes the processing andreinterpretation of seismic and other geological data, drilling of fourexploratory wells to target depth of 500 metres and construction of keyfacilities to support development. Following a commercial discovery, NEK would be entitled to 70 percent of theprofit from production at the four wells, terminating on the repayment of theirtotal investment and a single bonus payment of US$625,000 payable in cash or oilproduction. Olager will retain full rights for any further development beyondthe work programme. Executive Director William Kelleher commented today, "This deal gives Victoria afree carry during Tamdykol's early exploration stages and allows us to holdfocus on our larger West Medvezhye and Kemerkol projects, where drilling is tobegin in a matter of weeks." Tamdykol, a five square kilometre licence area in the post salt-depth region ofthe Emba oil and gas province of the Pre-Caspian basin, was acquired by Victoriafrom Celtic Resources Holdings Plc in August 2004. Prospect drilling on theSagiz Block of Emba, to which Tamdykol belongs, has so far yielded several oiland gas discoveries. Potential recoverable C3/D1 resources are estimated atapproximately 34 million barrels of oil beneath a sub-salt overhang. Olager isto extend the exploration licence for a further 2 years. Kevin Foo / George Donne Jamie Cumming / Tracy MackenzieVictoria Oil & Gas Plc Bell Lawrie+44 (0)207 921 8820 +44 (0)141 314 [email protected] +44 (0)141 314 8220 Leesa Peters/ Laurence ReadConduit PR+44 (0)207 618 8760+44 (0)7979 955 923 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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