Eurogas Corporation announced its financial results for the three months ending March 31, 2008. The Corporation earned $101,000 during the quarter.
In Spain, in accordance with agreements signed December 20, 2007, control of Escal and the Castor project has passed to ACS Servicios Comunicaciones y Energia, S.L. (ACS). ACS is responsible for any funding required and spent $851 thousand during the first quarter. ACS has agreed that, within 25 days of the grant of the Development Concession, it will repay to CLP most of the amount of its prior investment in the Castor Project which is approximately EUR 30 million (approximately $49 million using the March 31 exchange rate) of which approximately $44 million will be net to Eurogas.
Eurogas invested $1.3 million in Tunisia during the quarter. Subsequent to the end of the quarter, Eurogas announced that, along with its operating partner Atlas Petroleum Exploration Worldwide Ltd. (APEX), it had entered into a Farmout Agreement with Delta Hydrocarbons B.V. (Delta) with respect to the Sfax permit. The agreement has received all regulatory approvals. Under the agreement, Delta has committed to spend US$125 million on the Sfax permit for a 50% participation. Included in this amount, and as part of the transaction, Eurogas and APEX will be entitled to repayment of past exploration costs incurred on the permit, of which approximately US$11 million is net to Eurogas. Upon meeting its expenditure commitments, Delta would own a 50% participating interest in the farmout area, Eurogas would own a 22.5% participating interest and APEX would own a 27.5% participating interest.
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