EnerGulf announced the Hydrocarbon Exploration and Production Sharing Contract ("PSC") granted to its wholly owned subsidiary EnerGulf Africa Ltd., covering the Lotshi Block, located onshore in the Democratic Republic of Congo ("DRC"), has been ratified by Presidential Decree (ordinance) and is now effective.
The Lotshi Block covers approximately 475 sq km of the Les Zones du Bassin Cotier (ZBC) in the onshore coastal salt basin of the western DRC. It is contiguous to the highly prospective Cabinda area of Angola. The offshore blocks of Cabinda closest to the ZBC contain the giant (more than 500MM barrels of recoverable reserves) Malago and Takula field complexes operated by Chevron. The ZBC is also immediately adjacent to the East-Mibale, Laiwenda-Kinkasi and Muana-Banana fields operated by Perenco. Onshore oil production from the Perenco fields is about 9,000 bpd. Offshore production from Perenco and Chevron in DRC waters account for about 18,000 bpd.
EnerGulf will be the operator of the block and la Congolaise des Hydrocarbures ("Cohydro"), the state owned oil company of the DRC, will have a 10% carried interest in the block. The 5 year minimum work commitment provided for in the PSC is US$33,500,000.
Commenting for EnerGulf, Chairman of the Board Jeff Greenblum stated, "We are extremely excited about receiving the Presidential Decree ratifying our PSC and believe the Lotshi Block has the potential to become a cornerstone for EnerGulf's growth. We are looking forward to beginning the aggressive exploration program planned for this highly prospective area in the onshore coastal basin of the DRC."
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