Joint Participation Agreement

RNS Number : 3488D

San Leon Energy PLC

22 March 2011

 



22 March 2011

SAN LEON ENERGY

("San Leon" or the "Company")

Joint Participation Agreement

San Leon Energy and its Joint Venture Partner in Iraq Al Meinaa Oil Services Company ("Al Meinaa"), as per our announcement in January 2010, have signed a Joint Participation Agreement with the Governorate Council of Karbala in Central Iraq. Under this Agreement the consortium (San Leon, Al-Meinaa and the Governorate Council of Karbala) will submit a joint proposal to the Ministry of Oil in Iraq (the "Ministry") for the development of the fields of Kifil, West Kifil and Merjan (the "Project Area") under a production sharing contract. These Fields are located in the Karbala province (Kifil is shared between Karbala and Najaf).  San Leon and its partners will shortly enter into formal negotiations with the Ministry about the Project Area. 

Oisin Fanning Chairman of San Leon Energy commented:

"This agreement is the culmination of lengthy discussions conducted jointly with Al Meinaa and highlights our commitment to the joint venture agreement which we signed with them in 2010. We believe that the development of the Karbala fields (estimated at 600 mmbbls) will significantly contribute to the local economy. Our partnership in this project with the Governorate Council shows our determination to rely as much as possible on the contribution of local Iraqis to whom we intend to provide technical training in the field of both seismic acquisition and drilling as one of our first priorities.

We do not believe that this project will in any way impinge on our ability to deliver on our current operational timetable in Poland, Morocco and Albania and look forward to providing updates on these programmes shortly."

ENQUIRIES

San Leon Energy plc	Oisin Fanning, Executive Chairman	[phone]
	John Buggenhagen, Director of Exploration
Macquarie Capital (Europe) Limited		[phone]
	John Dwyer
	Paul Connolly
	Ben Colegrave
Fox-Davies Capital Limited		[phone]
	Phil Davies
	David Porter
Arbuthnot Securities Limited	Nominated Adviser	[phone]
	Nick Tulloch
	Ben Wells
College Hill	Investment Relations Adviser	[phone]
	Nick Elwes

Qualified person

John Buggenhagen has over 15 years experience in the oil & gas industry. He has a Ph.D. and M.Sc. in Geophysics from the University of Wyoming and a B.Sc. in Geophysics from the University of Arizona. He is currently the Director of Exploration for the San Leon Energy Group and based in San Leon's Warsaw

office in Poland.

Notes to Editors:

The Middle Furat area, comprising three undeveloped oil fields, is located in Karbala governorate in central Iraq, south of Al-Razaza Lake. The largest towns in the region are Karbala city and Hilla, just north and east, respectively, of the main oil producing area. All three fields are NW-SE trending structures with approximate sizes of 2.5 km by 2 km (Merjan), 10 km by 8 km (West Kifl) and 5 km by 1.5 km (Kifl). Oil has been tested in three Cretaceous and one Jurassic reservoir, while strong oil shows were observed in one Triassic reservoir.

The fields in the Middle Furat area were discovered in 1960 (Kifl), 1983 (Merjan) and 1987 (West Kifl). Six wells have been drilled in the Middle Furat Fields Contract Area, four wells in Kifl, one well in Merjan, and one well in West Kifl. Wells in each of the three fields have been drilled below the Cretaceous down to the Jurassic/Triassic in the Kifl field, to the Jurassic in the Merjan field and to the Permian in the West Kifl field.

 

END

 

 

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