Syrian Petroleum Company has now been formally advised of this decision and the Company will enter the first extension period of exploration, which commences on August 23, 2007. This period is for a further three years; during which the Company and its partner will undertake further exploration work under the terms of the PSC which must include, at a minimum, the acquisition of 250 square kilometers of 3D seismic and the drilling of two exploration wells.
The first extension period commences immediately upon expiry of the Initial Exploration Period and follows the relinquishment of an area equal to 25% of the original Contract area. The Company has identified and selected an area of lesser exploration potential in order to satisfy this mandatory relinquishment and considers that the relinquishment of this area will have no impact on the Company's future exploration program for Block 26.
Following the successful oil and gas discovery and production testing of the KHE-1 exploration well at Khurbet East in June of this year, the Company is now looking forward to the immediate continuation of its exploration program in Block 26.
Gulfsands' CEO, John Dorrier, said:
"Completion of the substantial seismic work and four well drilling campaign undertaken over the past two years is a tremendous achievement for a company of any size. The fact that we have already made a significant oil and gas discovery at Khurbet East adds to the significance of our move today to extend our PSC in Syria which will allow us to enter an exciting new phase during which we will acquire important 3D seismic data and drill additional wells both at Khurbet East and elsewhere as we look to build on our successes to date in exploring Block 26."
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