Jordan Approves Sonoran Energy MOU for Exploration Block

Sonoran Energy reports that the Government of Jordan has approved an agreement with Sonoran Energy to study the exploration potential of an oil field east of Jordan's capital city of Amman. The approved exploration study provides Sonoran Energy with a unique opportunity to partner with the National Resource Authority (NRA) of the Government of Jordan to enhance the country's oil production and to share in the success of that program. While the Jordanian Parliament has announced approval of the agreement publicly, the formal agreement (MOU) between Sonoran Energy and the NRA is expected to be signed over the next two weeks.

Over the next 5 months Sonoran Energy will study the exploration potential of the Azraq Block and the potential for increasing production from the Hamzah oil field through the use of modern drilling, completion and field development techniques. At the end of the 5-months period, Sonoran Energy will have first option on this block subject to agreeing a mutually acceptable work program with the NRA.

"Compared to neighboring countries, Jordan is vastly under explored," said David Mackertich, Sonoran Energy Vice President of Exploration and New Ventures. "Just over 100 wells have been drilled, almost 40 of which were in the Risha field area in the far north-east of the country. Large areas of the country possess only sparse 2D seismic data coverage and have seen little exploration since the late 1980's.

The Asraq Block lies in a proven play fairway that has seen little modern exploration. While reserves are likely to be small, it is the flow rates, which are likely to be heavily influenced by fractures, which will ultimately determine the commercial viability of any accumulation."

"Given Jordan's favorable fiscal terms, low cost base and the presence of a ready and expanding market the threshold reserves needed for a commercially viable project are considered to be under 1 million barrels," said Ala Nuseibeh, Sonoran Energy Middle East Executive Vice President. "The MOU will also provide Sonoran Energy with an opportunity to develop a working relationship with our partners and with the NRA."

Asraq Block

The Asraq Block is c. 11,250 sq kms in size, the eastern part containing the northerly extension of the Azraq-Sirhan Graben, which is mature for oil generation. The block contains the Hamzah oil field, which has been producing since 1985. This field is located some 100km due east of Amman with good road access.

The primary reservoir in the Hamzah field is a carbonate that has been produced through a limited number of vertical wells. The last well on the field was drilled in 1989 on 2D seismic data. At one stage the field was flowing over 400 bopd but it is now producing around 40 bopd. Total oil production from Hamzah to date is just under 1 million barrels of sweet oil. This is transported by truck to a refinery on the outskirts of Amman.

Jordan

Jordan occupies a strategic location in the Middle East, and is an important crossroads for regional energy integration. The Risha Gas field provides around 10% of Jordan's energy requirements. Jordan presently imports c. 100,000 bopd from neighboring countries.

National Resource Authority of the Government of Jordan

The Government of Jordan established the NRA in 1965 to regulate tasks, responsibilities and management of the Mining, Geology, Water and Irrigation Directorates. The NRA is entrusted with suggesting policies to investigate, develop and exploit energy and mineral resources and supervising all hydrocarbon activities within the borders of Jordan including granting concession, exploration and exploitation international agreements.