Gulfsands Petroleum plc, the oil and gas production, exploration and development company with activities in Syria, Iraq, and the U.S.A., has provided the following update on the Company's operations at Block 26, Syria where Gulfsands holds a 50% interest and acts as operator.
Application to Develop the Yousefieh Oil Field Granted by Syrian Authorities
Discovery of oil at Yousefieh-1, located approximately 3 kilometres east of the Khurbet East Field, was made in November 2008, with two subsequent appraisal wells being drilled in 2009.
Gulfsands has now received confirmation from Syria's General Petroleum Corporation that Gulfsands Petroleum Syria Limited has been granted permission to develop the Yousefieh Oil Field accumulation in Block 26 North East Syria. A production licence of 25 years duration has been granted, with the possibility of an extension if required, for a further 10 years.
The Yousefieh Field was assessed at the end of 2008 as containing gross proved plus probable reserves of 11 million barrels of oil. A further update on Yousefieh Field estimated gross reserves will be provided at the beginning of the second quarter 2010.
First oil from Yousefieh is anticipated early in April 2010. Production will commence from 2 wells, Yousefieh-1 and Yousefieh-3, at an expected initial combined rate of up to 1000 barrels of oil per day ("bopd").
Production from the wells will be closely monitored to assess flow performance and to determine whether the Yousefieh reservoir benefits from the same strong aquifer pressure support as is observed in the nearby Khurbet East Field. The current expectation is that the Yousefieh field has lower reservoir energy than Khurbet East and planning is underway to install permanent down-hole artificial lift equipment in both Yousefieh wells later in the year. In addition, a further development well on Yousefieh is planned for 2010.
It is anticipated that production from the Yousefieh Field will reach a rate of approximately 6000 barrels of oil per day by 2012.
Ric Malcolm, Gulfsands CEO, said: "We are delighted to have received the Syrian Government's early confirmation of development approval for the Yousefieh field and now look forward to commencing production as soon as practicable. The early production data obtained will provide valuable information that will assist us in optimizing the development of the field."
