SacOil provided an operational update on the Block III oil concession ("Block III"), Albertine Graben in the Democratic Republic of Congo ('DRC'), in which SacOil has an effective 12.5 percent interest.
As announced on March 4, 2011, Semliki Energy SPRL ("Semliki"), a 50 percent owned subsidiary of SacOil, successfully concluded a farm-in agreement in March 2011 with Total E&P RDC ("Total") pursuant to which Total acquired an effective 60 percent undivided interest in, and became the operator of, Block III. The Government of DRC holds an effective 15 percent interest and DIG Oil holds an effective 12.5 percent interest respectively in Block III.
SacOil announced the establishment of the Block III Operations Committee ("Committee") for the management of Block III joint venture operations. The Committee consists of members from SacOil, Total, DIG and a representative of the Government. The first meeting took place in Kinshasa in June 2011 and further meetings are scheduled to take place on a bi-annual basis to monitor and report back on the execution of the work program.
The work planned and agreed on Block III includes an airborne gravity and magnetic survey over the license area, the results of which are expected in 4Q of 2011. This will form the basis for the next stage of the program which will include the acquisition of a targeted 2D seismic survey. The performance of the work program is subject to first obtaining the relevant ministerial authorization.
Bradley Cerff, Vice President Commercial of SacOil commented, "I am pleased with the progress we are making at Block III with our partners Total. Work will shortly commence on carrying out the preliminary aeromagnetic surveys which is the precursor to targeted seismic surveys. The Block III project in the DRC has an exceptional postcode in terms of recent neighboring discoveries in Uganda. We look forward to updating shareholders on further work programs as we move towards drilling a maiden well on Block III during the first phase of the exploration period."
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