East West Petroleum on Thursday announced the company has signed a Production Sharing Contract (PSC) for Block AA-ONN-2010/2 with the Directorate General of Hydrocarbons of India in a signing ceremony held March 28th, 2012 in New Delhi. Partners in this NELP IX bid round Block are Oil India Ltd. (operator, 40 percent), Oil and Natural Gas Corporation of India (30 percent), and Gas Authority of India Ltd. (20 percent) and East West Petroleum (10 percent). The AA-ONN-2010/2 exploration Block lies in the Assam-Arakan Basin oil producing region of northeast India, a proven proliferous region where more than 100 fields have been found. Current production from the region is estimated at 95,000 boepd.
Under the terms of the PSC work program commitment, the partnership will acquire 152 square miles (395 square kilometers) of 3D seismic data and drill two wells, at an estimated cost to the Company of $2.8 million. The 3D data will cover the entire Block and be used to high-grade structural leads already identified on 2D data, in preparation for drilling. The acreage is considered to be oil-prone.
"Finalization of this NELP IX bid round award with the Government of India is an important milestone in the Company's growth plans and we now look forward to working closely with India's premier national oil companies to explore in India. We are especially interested to expand our relationship in a shale gas bid round which is expected to take place in the not-to-distant future," said Executive Chairman David Sidoo.
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