Albanian Production Sharing Agreements Approved
Manas Petroleum reported its wholly owned subsidiary, DWM Petroleum AG, has signed two production-sharing agreements (PSA) with the Albanian government in Tirana. The PSAs comprise blocks A, B, D, E, which cover approximately 3,100 square kilometers or approximately 766,000 acres. The televised signing took place at the Ministry of Economy, Trade and Energy. Mr. Genc Ruli the Minister of Economy, Trade and Energy and DWM and Manas Chairman Heinz J. Scholz signed the PSAs.
Under Albanian law the competent minister, in this case, Mr. Ruli, must approve and sign the agreement. Following this the council of ministers must ratify the agreement. This formality should be completed at the summer's end with the commencement of the session of the Council of Ministers.
This is a major milestone for Manas Petroleum and culminates almost two years of negotiations. A team of geologists and administrational staff has been recruited and work is underway to refine the original Shell/Coparex structural model with the assistance of Professor Selami Meco (paleontology, University of Tirana), and Agim Mesonjsi an Albanian-based structural geologist.
According to studies done by the previous block holders, Shell and Coparex, the four blocks hold a large deep under-thrust structure with a potential to hold a total of more than 800 million BOE of light oil and natural gas. Numerous oil seeps have been located where the reservoir rock outcrops along a significant portion of the eastern side of the Manas' blocks. Work to date using the Shell/Coparex data set by the Manas Petroleum's Albania exploration team has outlined a series of large prospects within the blocks.
Over 350 million barrels of oil have been produced from shallow oil fields which begin 100 Km to the south of the company's blocks. As mentioned previously, it is important to note that Shell and Coparex worked independently of one another in their initial discovery of the overall under-thrust structure and thus did not benefit from each other's seismic acquisition or understanding of the area's geology. Manas Petroleum is combining the two companies' $25 million data set for the first time. By combining the two data sets Manas Petroleum will further refine the Shell/Coparex models while greatly increasing the accuracy of the original Shell/Coparex estimates. Following the company's conclusion of this study an external independent engineering consultant will be employed to evaluate the results.
On July 12th the company announced it had been awarded an exploration license in Tajikistan. This license, the Novobod-Obchai-Kalacha, contains a number of under-thrust leads and prospects including the Khodja-Bakirgan, which are several kilometers north of the company's Kyrgyz South Tuzluk prospect. The Novobod is also adjacent to the Niyazbek-North Karachikum oil field, which is in Tajikistan. As in Kyrgyz Republic the company has no rights to production or reserves contained in oil fields, which already exist on its Tajik license. Approximately 60% of the company's Tajik block is covered by former Soviet era seismic data. It is within this area that the company's targeted leads and prospects are found and that the geological and structural setting appears to be very similar to the company's highly prospective Kyrgyz, Tuzluk block. Seven prospects of a similar size to or larger than the Kyrgyz, South Tuzluk prospect have been seismically identified on the Tajik license. Adding the 3,243 square kilometers covered by the company's Kyrgyz blocks to the 1,227 square kilometers covered by its recently awarded Tajik block and the company's targeted under-thrust oil prospects and leads are contained within an area totaling 4,480 square kilometers and not "more than 11,000 square km" as previously stated. This translates to approximately 1 million acres that the company has amassed in the Fergana Basin. Because it comprises the areas the company considers to have the highest potential to contain large oil fields, the company's planned acquisition program in the basin is largely complete. As mentioned in the previous news release negotiations to farm out the Tajik block are advanced. Seismic acquisition on the new Tajik block is expected to commence within this summer.