Immediate Release 27 May 2009
GULFSANDS PETROLEUM PLC
SYRIA OPERATIONS UPDATE
London, 27th May 2009: Gulfsands Petroleum plc ("Gulfsands", the
"Group" or the "Company" - AIM: GPX), the oil and gas production,
exploration and development company with activities in Syria, Iraq,
and the U.S.A., is pleased to provide the following operations update
for Block 26, Syria.
* Drilling of the Khurbet East No.10 (KHE-10) development
well has commenced. The well is designed to be a horizontal
producer approximately 700 metres northwest of the KHE-9 location
* Gross production from the Khurbet East Oil Field has
reached 3 million barrels.
* 3D seismic acquisition of 850 square kilometres has now
been completed
KHE-10 Development Well
Drilling operations at KHE-10 has commenced at a surface location
approximately 80 metres north of the recently completed vertical
KHE-9 well. The KHE-10 well will be deviated to a bottom-hole
location offset approximately 700 metres towards the northwest and is
designed as a horizontal producer. This will be the second of three
development wells programmed for 2009, all of which will be targeting
the highly productive central portion of the field. These three
producers will provide the additional oil required to bring
production rates up from a recent average of approximately 10,800
barrels of oil per day (bopd) to an end of 2009 production rate of
approximately 16,000 bopd following expansion of processing capacity
of the Khurbet East Early Production Facility to a capacity of
approximately 18,000 barrels of fluid per day. Production start-up is
expected early in the third quarter.
Khurbet East Oil Production
Gross oil production from the Khurbet East Oil Field has reached a
cumulative 3 million barrel milestone. The Field continues to
perform above expectations with strong pressure support and high
productivity from producing wells.
Exploration 3D Seismic Programme
Acquisition of the 850 square kilometre 3D seismic programme has now
been completed on time and within budget. Data is being transferred
to PGS in Cairo for processing. Delivery of final processed data is
expected late in the third quarter of 2009, with interpretation of
these data to commence immediately thereafter.
Ric Malcolm, Gulfsands CEO, said
"It is pleasing that development drilling is on schedule at Khurbet
East in preparation for an increase in field production rates early
in the third quarter. Also pleasing is the excellent production
performance of the Khurbet East Field and reaching another important
milestone. Completion of the 3D acquisition should now set the
framework for a potentially active exploration programme in 2010".
This release has been approved by Richard Malcolm, Chief Executive of
Gulfsands Petroleum Plc who has a Bachelor of Science degree in
Geology with 29 years of experience in petroleum exploration and
management. Mr. Malcolm has consented to the inclusion of the
technical information in this release in the form and context in
which it appears.
For more information please contact:
Gulfsands Petroleum (London) +44 (0)20 7434 6060
Richard Malcolm, Chief Executive Officer
Kenneth Judge, Director of Corporate Development +44 (0)7733 001 002
& Communications
Buchanan Communications Limited (London) +44 (0)20 7466 5000
Bobby Morse
Ben Romney
RBC Capital Markets (London) +44 (0)20 7653 4667
Sarah Wharry
ABOUT GULFSANDS:
Gulfsands is listed on the AIM market of the London Stock Exchange.
Syria
Gulfsands owns a 50% working interest and is operator of Block 26 in
North East Syria. The Khurbet East oil field was discovered in June
2007 and commenced commercial production within 13 months of the
discovery. This field is producing at an average production rate of
approximately 10,800 barrels of oil per day through an early
production facility. Block 26 covers approximately 8,250 square
kilometres and encompasses existing fields which currently produce
over 100,000 barrels of oil per day, and are operated mainly by the
Syrian Petroleum Company. The current exploration license expires in
August 2010 and is extendable for a further two years. Gulfsands'
working interest 2P reserves in Syria at 31 December 2008 were 35.2
mmbbls.
Iraq
Gulfsands signed a Memorandum of Understanding in January 2005 with
the Ministry of Oil in Iraq for the Maysan Gas Project in Southern
Iraq, following completion of a feasibility study on the project, and
is negotiating details of a definitive contract for this regionally
important development. The project will gather, process and transmit
natural gas that is currently a waste by-product of oil production
and as a result of the present practice of gas flaring, contributes
to significant environmental damage in the region. The Company is
actively engaged in discussions with respect to financing and
potential equity partners. Gulfsands has no reserves in Iraq.
Gulf of Mexico, USA
The Company owns interests in 44 blocks comprising approximately
138,000 gross acres offshore Texas and Louisiana, which include 30
producing oil and gas fields with proved and probable working
interest reserves at 31 December 2008 of 5.1 mmboe.
Certain statements included herein constitute "forward-looking
statements" within the meaning of applicable securities legislation.
These forward-looking statements are based on certain assumptions
made by Gulfsands and as such are not a guarantee of future
performance. Actual results could differ materially from those
expressed or implied in such forward-looking statements due to
factors such as general economic and market conditions, increased
costs of production or a decline in oil and gas prices. Gulfsands is
under no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise, except as required by applicable laws.
More information can be found on the Company's website
www.gulfsands.com
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