Petrel Awarded Production Sharing Agreement in Jordan

Petrel Resources has finalized a Production Sharing Agreement (PSA) on the East Safawi Block in Jordan. The PSA Effective Date will be May 1st when it will be published in the Official Gazette of Jordan.

The East Safawi Block forms part of the oil and gas prospective Arabian Desert. The East Safawi block adjoins the producing gas field at Risha and neighboring oil producing blocks in Syria. The oil targets are in shallow formations and there are well-established gas plays at deeper levels.

The Jordanian Production Sharing terms are world class. The contractor receives 60% of oil production – or gas equivalent - up to 10,000 barrels daily, with a sliding scale to a 35% share of production over 100,000 barrels daily oil equivalent.

The agreement allows for a 3 year first phase exploration. Initial work includes seismic reprocessing and reinterpretation and new seismic. Targets identified will be followed up by drilling. Work already completed by Petrel on the block suggests a number of drillable targets. Drilling is expected to take place in late 2008 – early 2009, depending on operational developments.

Jordan is a stable constitutional monarchy. The Jordanian authorities are pro-business. Jordan is part of the Arab gas pipeline project and will be both a contributor and reliable access route for Middle Eastern gas exports to Europe.

Petrel Managing Director, David Horgan, commented:

'This is a good block, in a highly prospective area: the Arabian Desert has both oil and gas potential. With great terms already in place, we are starting work straight away, reprocessing and acquiring seismic to identify drilling targets.

Winning the East Safawi Production Sharing Agreement is the culmination of three years work with the Jordanian authorities. Terms are world-class, especially for oil. Jordan is an excellent business location: secure, friendly and pro-business, which geographically and geologically fits well into Petrel's Iraq-centered strategy".