Bengal announced the Ministerial Grant from the Department of Natural Resources and Mines of Authority to Prospect 732P ("ATP 732P"), located in the Cooper/Eromanga Basin, Queensland, Australia has been officially received with an effective starting date of April 1, 2011. Subject to the terms of the previously reported purchase and sale agreement, Bengal will acquire a 100 percent working interest and operatorship of ATP 732P upon the sale agreement's closing, expected on or about March 13, 2011.
ATP 732P is a large, lightly explored permit measuring 654,321 acres. Only eight exploration wells have been drilled on the permit, three of which had hydrocarbon shows. The permit is adjacent to blocks with several producing oil and gas fields from numerous depth horizons, including gas from the deeper Permian horizons and light oil from Jurassic and Cretaceous sandstone reservoirs. ATP 732P is dominated by a large circular structure believed to be an ancient meteorite impact zone (the Tookoonooka structure). Permian sands and coals may exist and possibly pinch out against a Paleozoic highland within the permit. This consequently may create stratigraphic traps for gas and gas liquids. Structural features ringing the impact structure are potentially prospective for shallower light oil reservoirs. Additional stratigraphic channel plays have also been identified and are being investigated. Drill target depths are expected to range from 1,000-1,800 meters depth.
The Company's existing leads and plays in ATP 732P were reviewed with independent technical consultants who subsequently prepared a resource study. A summary of the results of an independent Resource Evaluation Report (the "Report") prepared by Ryder Scott-Canada ("Ryder Scott"), and having an effective date of February 1, 2011 were recently provided by the Company in a press release dated March 1, 2011 and are also included herein. The prospect opportunities identified thus far on ATP 732P, are in the opinion of the Company, worthy of an accelerated exploration program.
It should be clearly understood that the resource prospects evaluated in the Report are high risk exploration plays. No commercial hydrocarbons have been discovered to date on ATP 732P. The undiscovered petroleum initially-in-place ("Undiscovered PIIP") discussed herein includes unrecoverable volumes and is not an estimate of the volume of the substances that will ultimately be recovered. In addition, there is no certainty that any portion of the resources discussed herein will be discovered. If discovered, there is no certainty that it will be commercially viable or technically feasible to produce any portion of such resources.
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