Gulfsands Petroleum has exercised its option to increase from 20% to 30%, the working interest position it is acquiring in the Kerkouane Exploration Permit, offshore Tunisia (Kerkouane Permit) and in the adjacent Pantelleria exploration permit in Southern Italy (G.R15.PU, known as the Pantelleria License) from subsidiaries of AuDAX Resources.
Gulfsands' decision to increase its working interest in these permits follows from an assessment of the "fast-track cube" processed from the recently completed 3D seismic survey carried out over the Lambouka Prospect. Data from the 3D seismic survey was also used to select several potential drilling locations for the Lambouka-1 exploration well, with final location selection determined following completion of a survey of the seabed at the alternate locations.
Tunisian government approval to move the "Atwood Southern Cross" drilling rig onto location at the selected Lambouka-1 well location is expected shortly with drilling anticipated to commence in the second half of June. Tow vessels are now on route to Tenerife on the Canary Islands to begin the tow of the Southern Cross to the Lambouka -1 well location. The gross cost of the Lambouka exploration well is estimated at approximately $20 million with drilling anticipated to take approximately 30 days.
AuDAX has estimated the mean prospective resource for the Lambouka Prospect at 270 million barrels oil equivalent ("MMBOE") with the primary objectives for the well being the Miocene aged Birsa Formation and the Cretaceous aged Abiod Formation.
Following the exercise of Gulfsands' option and completion of all earn-in obligations, the respective interests of the parties in the "Lambouka Prospect Area" being the limited area defined to be over the Lambouka prospect within both the Kerkouane Permit and the Pantelleria License, will be:
Following the exercise of Gulfsands' option and completion of Gulfsands' and Bombora's farm-in obligations and exercise of elections with respect to the Pantelleria License, the respective interests in the remainder of the Kerkouane Permit and the Pantelleria License (outside of the Lambouka Prospect Area) and the Kerkouane production sharing contract will be as follows:-
Chorbane Permit -- Onshore Tunisia
Formal farm-in documentation for the acquisition of a 40% interest in the Chorbane permit, located onshore central Tunisia is expected to be finalized shortly with the intention to drill a well on the Chorbane permit before the end of 2010.
Kerkouane & Pantelleria block map showing leads & prospects and the rectangular shaped Lambouka Prospect Area (approx. 150 sqkm). The insert map shows a depth structure map of Lambouka at Birsa oil reservoir level and the Lambouka area.
Ric Malcolm, Gulfsands CEO, said, "We were encouraged by our evaluation of the prospectivity of the Lambouka Prospect following receipt of the high quality 3D data acquired in the recent seismic survey and have therefore elected to increase our interest in this exciting project. We are looking forward to the commencement of drilling operations on the Lambouka prospect in late June."
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