Canamens to Pull Out of Polish Siekierki Project
Aurelian Oil & Gas has been informed by Canamens Limited ("Canamens") that, as the result of a strategic review of its priorities, it intends to withdraw from participating in the Polish Siekierki project. The precise terms of the withdrawal of Canamens from the project are the subject of continuing discussions. If Canamens' withdrawal is confirmed, the farm-out agreement announced on November 10, 2008 ("November Agreement") will terminate and Aurelian will re-acquire the 40% interest which Canamens gained under the terms of the November Agreement. After the withdrawal, Aurelian's shareholding in the project will revert to 90%, with the balance of 10% continuing to be held by Avobone NV.
Canamens have stated that their intended withdrawal should not be taken as an indication of any change in their view of the considerable attractions and potential of the Siekierki project which had led to their initial involvement. The results of the 3D seismic (announced on April 7, 2009) extended the area of structural trend. The estimated gas in place in the structure is now believed to be considerably higher whilst the contingent resources have also increased significantly.
In the light of the anticipated withdrawal of Canamens, the Company's priority is to introduce a replacement partner as soon as possible so as to minimize delays to the Siekierki project timetable. The Company is currently actively involved in discussions with potential partners which it expects to conclude this summer.
Michael Seymour commented, "The potential and attraction of the Siekierki project remains undiminished. Whilst we are disappointed that Canamens have come to this decision at this stage in the project's development, we are very much encouraged by recent 3D seismic results. We are also already in discussions with other companies about participation in the project and are confident of coming to an agreement with them shortly."