First Calgary Petroleums Provides Operational Update
First Calgary Petroleums Ltd. announced that the farmout agreement with Canadian Nexen Yemen Ltd.covering Block 43 in the Republic of Yemen, previously announced June 13, 2001, has been terminated due to certain closing conditions not being satisfied.
Notwithstanding the termination of the Nexen agreement, FCP has elected to proceed to the Second Exploration Phase of Block 43 undertaking to drill at least two additional wells. To assist in financing the second phase work program, FCP has signed a Memorandum of Understanding with DNO ASA whereby DNO will partner with and operate the Block. DNO, a Norwegian based international oil and gas company (Oslo Stock Exchange) has operations in the North Sea and Yemen. The Memorandum of Understanding is subject to the parties entering into a farmin agreement. The Yemen Ministry of Oil and Minerals has granted its preliminary approval to DNO's participation in Block 43.
Mr. Richard Anderson, President of FCP, commented that he is pleased to be continuing into the second exploration phase and optimistic about the potential of Block 43 which immediately offsets the Masila Block 14, currently producing in excess of 220,000 barrels of oil per day.
With DNO, FCP joins with an oil and gas partner that is a knowledgeable, proven operator in Yemen. DNO operates block 32 immediately to the north of Block 43 and also holds an interest in Block 53 in close proximity to the west, both of which are being actively developed.