Pan Andean Farms-Out Ucayali Basin Blocks to CEPSA

Pan Andean announced that CEPSA of Spain and Perupetrol have finalized the legal agreement whereby CEPSA becomes the Operator of Blocks 114 and 131 in the Ucayali area of Peru. A Supreme Decree has been issued authorizing the transaction.

Under the terms of the agreement, Pan Andean maintains a 30% carried interest in each block with all expenditure funded by CEPSA, up to and including 100%of the first exploration well on each block and 50% of a second well on each block.

CEPSA have paid Pan Andean back costs incurred on the blocks totalling $3 million to date on both blocks.