Sterling has signed farm out agreements with Petro Ventures Limited (PV), a wholly owned subsidiary of Petro Ventures International Limited, an Australian registered company. We welcome PV to the greater Breagh area.
Agreement in initial form for this transaction was announced in October 2007, when PV farmed into Breagh. Under the full farm-out agreements now signed, PV will earn a 20-percent working interest in license P1231 (Blocks 42/19, 42/20 and 42/24) and license P1524 (Blocks 42/2b, 42/3 and 42/4) and a 15-percent working interest in license P1327 (Blocks 42/8, 42/9 and 42/14). The agreements involve a promote element, subject to a price cap, for the first well to be drilled in each of the P1231 and P1327 licenses. Following completion, which requires government and in some cases partner approval, Sterling will retain a working interest of 80-percent in licenses P1231 and P1524, and 60-percent in license P1327. Sterling will consider further farm outs prior to drilling.
The first well planned for P1231 is scheduled for 2008 as part of the recently announced program for the Ensco 70 jack up rig. In P1327, a new seismic shoot is planned to start at the end of April to firm up possible drilling locations for 2009.
The Board of Directors of Sterling Resources has awarded stock options to new employees of its subsidiary, Sterling Resources (UK) Ltd. Options were granted to acquire 350,000 common shares of the Corporation at an exercise price of $2.50 per share. The options are exercisable for a five-year term and vest over three years from the date of grant.
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