The licenses were awarded to TransAtlantic based upon a commitment to work programs on each of the respective areas. TransAtlantic will be the operator and 100% working interest owner of the licenses. Following a commercial discovery the exploration license is converted to a production lease that bears a 12.5% royalty, yielding an 87.5% net revenue interest to the company (corporate tax rate of 20%). The work program commitments will total approximately US$300,000 on all three blocks over the next two years. Additional commitments to shoot seismic or drill wells will be made based on the additional information.
Two of the licenses (AR/TAT/X/4173 and AR/TAT/X/4174) are located near the town of Bismil on the Tigris River. These licenses are adjacent to two producing oil fields (Molla and Karakilise). The company's primary target is an under-explored Palaeozoic play located at a depth of approximately 3,000 meters. The work program involves reprocessing existing 2D seismic data and, based on these results, additional 2D seismic may be shot or a well drilled.
The third license (AR/TAT/X/4175) is located near Cizre, approximately 60 kilometers from the Iraq border. The target is a deep sub-thrust play similar to the major Iraqi and Iranian Zagros fields to the south. An anticipated exploratory well on a nearby block directly east of this license could provide support for the potential on TransAtlanticís license. The company values exposure to this frontier area and will conduct an initial work program of detailed fieldwork and geochemical analysis that is expected to lead to a 2D seismic program to define a drilling location. There is presently no 2D seismic over the area.
TransAtlantic is engaged in the exploration, development, and production of crude oil and natural gas in the U.S. and has interests in Morocco, Turkey, the United Kingdom, and Romania.
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