Loon's Application for Syrian Block Ratified
Loon Energy says that the parliamentary ratification of the Contract for the Exploration, Development and Production of Petroleum with the Government of the Syrian Arab Republic, represented by the Ministry of Petroleum and Mineral Resources and the Syrian Petroleum Company for Block 9, was accepted and signed by the President of Syria. The Block 9 PSC has come into effect under Law 27 with an effective date of November 29th 2007.
Loon originally announced its award of the exclusive right to negotiate a PSC covering Block 9 on June 1, 2006 and the recent ratification was the culmination of a lengthy process of negotiation that followed the original award. As part of the signing process, Loon has posted a bank guarantee of US$7.5 million.
Block 9 is a large and under-explored area of more than 10,000 km2 located at the northern edge of a hydrocarbon-producing basin called the Homs Basin, which contains the large Palmyra, Cherrife Da and Ash Shaer fields.
Under the terms of the Block 9 PSC, Loon has a first phase exploration period of four years during which it has committed to acquire 600 kilometers of 2D seismic and drill two exploration wells. The exploration period can be extended for up to nine years in phases by performing additional work on an agreed basis.
Loon has a 100% interest and is the operator of Block 9. ANSCO Inc., subject to the approval of the Ministry and SPC, has the right to acquire a 5% working interest in Block 9 on a heads-up basis.