Block 128 is adjacent to Gran Tierra's existing acreage in Block 122, which was awarded to the Company earlier in 2006. The two blocks are located on the eastern flank of the Maranon Basin in northern Peru, on the crest of the Iquitos Arch. Block 128 covers 2.2 million acres. Together with Block 122, the Company now has a 100% working interest in 3.2 million acres over the Iquitos Arch, the largest landholding on this trend.
The license contract for Block 128 defines a seven-year exploration term divided into four periods, each involving a minimum work/financial commitment. The minimum commitment for the first work period, which is mandatory, is $0.5 million. The potential commitment over the seven-year period is $3.6 million and includes technical studies, seismic acquisition and the drilling of one exploration well. The license contract defines an exploitation term of thirty years for commercial discoveries of oil.
Dana Coffield, President and Chief Executive Officer of Gran Tierra, stated, "This second transaction marks the completion of our exploration land acquisition in a significant new exploration play in Peru. We now have the dominant acreage position in this play, and will begin work in 2007 towards maturing this land to define seismic acquisition programs and future drilling opportunities."
Gran Tierra Energy Inc. is an international oil and gas exploration and production company, headquartered in Calgary, Canada, incorporated and traded in the United States and operating in South America. The Company holds interests in producing and prospective properties in Argentina, Colombia and Peru.
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