CMI to acquire interest in Cladhan discovery

Sterling Resources has reached agreement with Challenger Minerals (CMI) under which CMI may acquire a 10% interest in the Cladhan discovery.

Offshore staff

CALGARY, Canada -- Sterling Resources has reached agreement with Challenger Minerals (CMI) under which CMI may acquire a 10% interest in the Cladhan discovery. Sterling currently holds a 39.9% working interest in Cladhan, located in block 210/29 in the northern North Sea.

The option to acquire the interest will follow a contribution towards past well costs and the payment of a carry on the forthcoming sidetrack well, according to Sterling. In addition, Sterling will acquire a 10% working interest, on a ground floor basis, in the Crosby well to be drilled by CMI during May. The Crosby well is located in the East Irish Sea and is located between the Lennox and Hamilton fields. Completion is subject to formal agreement and normal partner and government approvals.

Sterling also reports that it has elected to take back operatorship for the Sheryl (block 21/23a in the central North Sea). The project has been on hold, awaiting capacity in the Pict pipeline system, which is anticipated to be available in late 2009 or early 2010. Sheryl was originally drilled in 2006 and tested oil at a maximum rate of 1,915 b/d of 22º API gravity oil, although independent studies indicate the potential for up to 10,000 b/d of oil from a high angle well with sand control and artificial lift, the company says.

03/12/2009

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