25th Apr 2005 07:01
Gulf Keystone Petroleum Ld25 April 2005 25 APRIL 2005 GULF KEYSTONE PETROLEUM LIMITED ("Gulf Keystone" or "the Company") UPDATE ON NEW BLOCKS Gulf Keystone Petroleum, Ltd. (AIM-GKP), an independent oil & gas explorationcompany, is pleased to announce that following the award of two contracts in theAlgerian Sixth Licensing Round it has increased the size of its total holdingsin the Republic of Algeria to more than 22,700 square kilometres. The contractssignificantly increase Gulf Keystone's existing Algerian portfolio, previouslyconsisting of block 126a, by adding an additional six blocks. A total of 35 bidswere placed involving 25 companies for 9 blocks. The other license winners wereShell (2 blocks), BHP (2 blocks), and BP (3 blocks). On April 23, 2005, Gulf Keystone signed contracts with the Algerian Ministry ofEnergy and Mines for both the Hassi Ba Hamou perimeter (blocks317b1-322b3-347b-348-349b) in central Algeria's Bechar Oued Namous Basin, andthe Bottena perimeter (Block 129) in north eastern Algeria's Constantine Basin. Hassi Ba Hamou Perimeter The Hassi Ba Hamou perimeter covers an area of 18,380 square kilometres andcontains one existing gas field, HBH, which SONATRACH's engineers estimatecontains over 1 trillion cubic feet of gas in place. The HBH Field wasdiscovered in 1965 before the existence of the gas pipeline that now crosses theblock, and, thus, has never been developed and put on production. The HBH-1discovery well flowed at an initial rate of approximately 3 million cubic feetper day from porous sands above 3,200 feet depth. SONATRACH's interpretation ofthe previously acquired 4,069 kilometres of 2D seismic has identified 8additional prospects and leads with combined exploratory potential of anadditional 4.4 trillion cubic feet of gas in place. Gulf Keystone plans toappraise the existing discovery, HBH-1, drill two exploration wells, acquire 100square kilometres of 3D seismic and acquire 400 kilometres of 2D Seismic duringthe first three year phase of the contract. Bottena Perimeter The Bottena perimeter covers an area of 4,368 square kilometres and is situatednext to the eastern border of Gulf Keystone's Block 126a extending eastward tothe Tunisian border. The license area contains the Djebel Onk Field, which isexcluded from the license, and the Hassi El Kerma (HEK) Field which wasdiscovered in 2001 and which SONATRACH identifies as containing 178 millionbarrels of oil in place (27 million barrels defined as proven and probable).This is more than 2.5 times larger than the resources they attribute to DjebelOnk which to date has produced 9 million barrels of oil. SONATRACH recentlydrilled two additional structures, on the permit area, DDN (2000) and HCZ(2002). SONATRACH have estimated that these structures contain a combined 182million barrels of oil in place. Using its 5,300 kilometres of 2D seismic,SONATRACH has mapped an additional two prospects and 21 leads that they assignestimated oil in place resources of more than 750 million barrels. Finally, SONATRACH has drilled 4 wells on what was the first hydrocarbondiscovery in the basin (1954), the Djebel Foua Field. SONATRACH has previouslytested gas at rates greater than 8 million cubic feet per day from depths abovethan 3,000 feet. This field is only 20 kilometres from the Trans-MediterraneanPipeline. Gulf Keystone intends to appraise the discoveries Hassi El Kerma andDjebel Foua, drill one exploration well and acquire additional 2d and 3d seismicon the Bottena Perimeter. The Company also confirms that drilling on GKS-3 commenced on Thursday 7 April. Todd Kozel, Chief Executive Officer of Gulf Keystone said: "We have significantly increased our opportunities in the Algerian oil and gassector. Whilst Gulf Keystone will have the benefit of appraising the existingoil & gas discoveries on these newly awarded blocks, we will also activelypursue the substantial exploration upside that SONATRACH estimates as over 1.5billion barrels of oil equivalent in place." Enquiries Evolution Securities 020 7071 4300Robert Collins Citigate Dewe Rogerson 020 7638 9571Martin Jackson/George Cazenove This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Gulf Keystone Petroleum