Bankers Petroleum Ltd. has elected to exercise its option to acquire the remaining 50% interest in the Kucova oil field, located in Albania, through the acquisition of the remaining 50% of the issued and outstanding securities of an independent private company, Sherwood International Petroleum Ltd.
The final closing was completed for a payment of $1.5 million. Sherwood is now a wholly-owned subsidiary of Bankers and holds the exclusive right to evaluate and redevelop the Kucova heavy oil field pursuant to a Petroleum Agreement with Albpetrol Sh.A., the state-owned petroleum company, and a License Agreement with the National Agency of National Resources.
The terms of the Petroleum Agreement are substantially the same as those governing Bankers' Petroleum Agreement for the Patos Marinza oil field in Albania. Bankers is in the process of completing a work program and budget to further develop the Kucova field, which has in excess of 490 million barrels of original-oil-in-place and has only produced 5% or 25 million barrels of the oil-in-place.
Bankers' management believes that the use of modern technologies and maintenance practices will make this field an attractive candidate for further development given the low recovery of oil to date. A revitalization program planned for this opportunity would involve updating surface and downhole equipment, wellbore stimulations, recompletions and the incorporation of secondary recovery techniques, such as waterflood recovery.
An independent reserves evaluation to define the remaining reserves and production potential of the Kucova oil field, compliant with Canadian Security Administrators' National Instrument 51-101, is expected to be completed in August 2008.
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