Gulfsands signs farm-in off Tunisia

Gulfsands Petroleum has signed a farm-in agreement to acquire interests in the Kerkouane exploration permit offshore northeast Tunisia, and G.R.15.PU, an adjacent exploration permit offshore the island of Pantelleria, southwest of Sicily in Italian waters.

Offshore staff

LONDON -- Gulfsands Petroleum has signed a farm-in agreement to acquire interests in the Kerkouane exploration permit offshore northeast Tunisia, and G.R.15.PU, an adjacent exploration permit offshore the island of Pantelleria, southwest of Sicily in Italian waters. Both are operated by AuDAX Resources.

The two permits are contiguous and cover a total area of 4,500 sq km (1,737 sq mi). The exploration and production terms within the Kerkouane permit are governed by a Tunisian Production Sharing Contract, while those for the Pantelleria license are governed under an Italian tax/royalty structure.

Both permits contain multiple prospects and leads, the most significant of which is thought to be the Lambouka prospect, a large horst block in 400 m (1,312 ft) of water containing multiple reservoir targets and traversing the median line between the concessions.

AuDAX recently acquired 3D seismic over Lambouka, completing processing of the “fast-track cube” early in May. The data will be used to determine the drilling location for the Lambouka-1 exploration well, following completion of a current geotechnical site survey and government approval.

Mean prospective resources for the Lambouka prospect are estimated at 270 MMboe. The main objectives for the well, due to be drilled next month by the Atwood Southern Cross, will be the Miocene-age Birsa formation and the Cretaceous Abiod formation.

Gulfsands has earned the right to acquire a 20% interest in both permits by paying 30% of the cost of the recent 3D seismic program. It also has the option to secure an additional 10% through payment of an additional 15% of the initial well cost, although this option must be exercised prior to the start of the first exploration well.

05/18/2010

More in Regional Reports