Baron Oil Regulatory News (BOIL)

10 Feb 2005 14:48

Gold Oil PLC10 February 2005 FOR IMMEDIATE RELEASE 10th February 2005 GOLD OIL ACQUIRES A SECOND EXPLORATION BLOCK IN NORTHERN PERU Gold Oil Plc ("Gold Oil" or the "Company"), the London-based oil explorationcompany focused on Central and South America, announces that on Wednesday 9thFebruary 2005, it signed a promotion agreement with PeruPetro (the State Oilcompany of Peru) for a large virtually un-explored area of the Pacific, beingthe immediate offshore extension of the prolific Talara Basin of northwesternPeru, known as "Offshore Z-34 Cuenca Talara". Offshore exploration Block with PeruPetro Gold Oil has agreed with PeruPetro to evaluate this large licence which lies inthe offshore sector of the Talara Basin, northwestern Peru. The agreement covers371,339 hectares (equivalent to 17 North Sea blocks), and in places extends fromwithin a few meters of the coast to almost 100kms with water depths of 150 to3000m. The licence lies offshore of the cities of Lobitos, Cabo Blanco,Negritos, Talara and Paita (Piura Department). A comprehensive oilinfra-structure exists onshore, servicing the Talara oil fields. The area was selected by Gold Oil because of the demonstrable potential for theextension offshore of two of the main field complexes that constitute the TalaraBasin. The block borders the PetroTech oil fields that have estimated reservesof 400 million barrels. Further to the east is the oldest producing oil field inSouth America which to date has produced in excess of 1,600 million barrels ofoil. The block also borders BPZ's block to the North that has recently had areserves report prepared by an independent petroleum engineering company showingP3 reserves of up to 4 Tcf of natural gas. Under the terms of the promotion agreement with PeruPetro, Gold Oil hasexclusive rights to the area for a period of fifteen (15) months. However, GoldOil intends to convert to an exploration licence once the rationale for thedrilling of a new exploration well can be supported. At the moment, thecontractual work obligation requires only various geological, geophysical andengineering studies; there is no requirement to shoot new seismic or drill awell. The search for oil and natural gas in areas where it has a competitive andcommercial advantage continues to be the focus of Gold Oil's strategy. In thisway, it can most effectively create value for shareholders. Extraordinary General Meeting The Company is proposing to write to shareholders seeking their approval at anExtraordinary General Meeting to be convened to increase the Directors'authorisation to issue shares for cash. A further announcement will be made whenthe arrangements have been concluded. Commenting on today's announcement, Gary Moore, Operations Director of Gold Oil,stated: "Now that we have secured these funds we can develop the very significantpotential of the offshore Talara area and the onshore blocks in the largeSechura basin. Our exposure in the offshore block is minimal, but withinfrastructure close by we are well positioned in the event that a well can bejustified and proves the presence of economically recoverable oil. In the eventof an offshore discovery, we would be in a position to leverage recenttechnological advances in offshore turbidite exploitation. Gold Oil's recently awarded onshore Block XI lies some 50kms to the east and wewill now be able to swiftly secure the gas reserves that will be monetised withearly cash flow." Enquiries: Gary Moore Operations Director Tel: +44 (0)1737833597 Email: gmoore@goldoilplc.comMike Burchell Chairman Tel. +44 (0) 1372361772 Email: mikeburchell@hotmail.comRoland Cornish Beaumont Cornish Limited Tel: 020 7628 3396. Note to Editors The promotion agreement entails re-examining all the existing regional seismiclines shot over the block; there are no wells in the area, even though thelimits to producing fields adjoining the block stop at the coastline. Production onshore in the Talara Basin comes from lenticular sandstone bodiesforming part of a proximal fluvio-deltaic fan system that thins westward as thereservoir quality improves. The distal extent of this system, known from a fewwells to the north (including the Ancora Field), may contain high qualityturbidite sandstones and has scarcely been explored. The area is equivalent to just less than 17 North Sea blocks. There are severaltarget reservoirs mostly at depths of between 150 to 3000m. This information is provided by RNS The company news service from the London Stock Exchange