Addax Petroleum Awarded Additional Interest in Deep Water Exploration License in Joint Development Zone
16/07/2008 18:04
PR Newswire
CALGARY, Canada, July 16 /PRNewswire/ --
- Additional 7.2 Per Cent Interest in JDZ Block 4 License Area
Addax Petroleum Corporation (TSX: AXC and LSE: AXC) ("Addax Petroleum"
or the "Corporation") announces today that it has been awarded an additional
7.2 per cent participating interest in Block 4 of the Nigeria/Sao Tome and
Principe Joint Development Zone ("JDZ") by an independent arbitration
tribunal. The award increases Addax Petroleum's interest in the license area
from 38.3 per cent to 45.5 per cent. Addax Petroleum is also the operator of
Block 4.
Commenting, Jean Claude Gandur, President and Chief Executive Officer of
Addax Petroleum said: "This award further enhances our leading position in
this world class exploration region. I am very excited about the prospective
oil resources of Addax Petroleum's entire deepwater portfolio and I am
looking forward to launching our high impact drilling campaign. Due to our
interests across four JDZ license areas, a focused drilling strategy will
be undertaken to include a consecutive exploration campaign of up to 10
wells across the region to demonstrate the full potential of these assets.
I believe these exploration assets will be an important contributor to the
growth of the company and will deliver value to our shareholders."
In 2007, Addax Petroleum and ERHC Energy Inc. ("ERHC") entered into
arbitration proceedings in respect of a 9 per cent participating interest
in JDZ Block 4 that had been committed to a third party. When that party
failed to fulfil its obligations, the 9 percent reverted to Addax Petroleum
and ERHC. Under the arbitration proceedings, Addax Petroleum claimed
entitlement to 7.2 per cent of the 9 percent interest, subject to the carried
costs associated with the balance, being the 1.8 per cent to which ERHC was
entitled. A panel of the London Court of International Arbitration confirmed
that Addax Petroleum is entitled to the 7.2 per cent additional interest for
no additional monetary consideration beyond the US$18 million previously paid
by Addax Petroleum to ERHC. Addax Petroleum will continue to carry the costs
associated with ERHC's 19.5 per cent interest in JDZ Block 4.
Addax Petroleum has contracted to commence drilling operations in JDZ
Block 4 in the fourth quarter of 2008, but believes that the drilling rig
will not be delivered until the second half of 2009. In the interim, the
Corporation continues to seek a rig of opportunity to drill the 458 MMbbl
Kina prospect in JDZ Block 4 as early as the fourth quarter of 2008.
The JDZ was established in 2001 following the ratification of a formal
bilateral treaty between Nigeria and the island nation of Sao Tome and
Principe. The JDZ is located approximately 200 kilometres offshore Nigeria
and is adjacent to deepwater areas where several large petroleum discoveries
have been made. As at December 31, 2007, NSAI estimates the total best
estimate unrisked prospective oil resources for identified prospects in the
JDZ to be 2,323.1 MMbbl (990.5 MMbbl risked), of which the Corporation's
working interest is 726.6 MMbbl (313.0 MMbbl risked), and the total best
estimate unrisked prospective oil resources for the Kina Prospect to be
458.0 MMbbl (172.5 MMbbl risked).
About Addax Petroleum
Addax Petroleum is an international oil and gas exploration and
production company with a strategic focus on West Africa and the Middle East.
Addax Petroleum is one of the largest independent oil producers in West
Africa and has increased its crude oil production from an average of 8,800
bbl/d for 1998 to an average of approximately 139,100 bbl/d for the first
quarter of 2008. Further information about Addax Petroleum is available at
http://www.sedar.com, http://www.londonstockexchange.com or the Corporation's
website, http://www.addaxpetroleum.com.
Information about Resources Estimates
Resources information in this news release is set out in greater detail
in Addax Petroleum's Annual Information Form dated March 13, 2008 ("AIF"),
which is available on the SEDAR website, www.sedar.com, the London Stock
Exchange Market News website, www.londonstockexchange.com or the
Corporation's website, http://www.addaxpetroleum.com. Resources information
in this news release in respect of the JDZ is derived from NSAI's Estimate
of Reserves and Future Revenue, Contingent Resources, and Prospective
Resources report dated January 11, 2008 and is subject to the risks,
limitations and other relevant factors in respect of such resource estimates
as set out in Addax Petroleum's AIF.
Prospective resources are those quantities of petroleum estimated, as of
a given date, to be potentially recoverable from undiscovered accumulations
by application of future development projects. Prospective resources have
both an associated chance of discovery and a chance of development. The
prospective oil resources indicate exploration opportunities and development
potential in the event a commercial discovery is made and should not be
construed as reserves or contingent resources. There is no certainty that
any portion of the resources will be discovered. If discovered, there is no
certainty that it will be commercially viable to produce any portion of
the resources.
Legal Notice - Forward-Looking Statements
Certain statements in this news release constitute forward-looking
statements under applicable securities legislation. Such statements are
generally identifiable by the terminology used, such as "anticipate",
"believe", "intend", "expect", "plan", "estimate", "budget", "outlook",
"may", "will", "should", "could" , "would" or other similar wording.
Forward-looking information in this news release includes, but is not limited
to, project development schedules and results, results of exploration
activities and dates by which certain areas may be developed or may come
on-stream, the Corporation's business strategy and goals, future capital and
other expenditures and reserves and resources estimates. By its very nature,
such forward-looking information requires Addax Petroleum to make assumptions
that may not materialize or that may not be accurate. This forward-looking
information is subject to known and unknown risks and uncertainties and
other factors, which may cause actual results, levels of activity and
achievements to differ materially from those expressed or implied by such
information. Such factors include, but are not limited to: imprecision of
reserves and resources estimates; ultimate recovery of reserves; volatility
of prices of oil and natural gas; general economic, market and business
conditions; industry capacity; competitive action by other companies;
refining and marketing margins; the ability to produce and transport crude
oil and natural gas to markets; the results of exploration and development
drilling and related activities; fluctuation in interest rates and foreign
currency exchange rates; the ability of suppliers to meet commitments;
actions by governmental authorities, including increases in taxes; decisions
or approvals of administrative tribunals; changes in environmental and other
regulations; risks attendant with oil and gas operations, both domestic and
international; international political events; expected rates of return; and
other factors, many of which are beyond the control of Addax Petroleum. More
specifically, production may be affected by such factors as exploration
success, start-up timing and success, facility reliability, reservoir
performance and natural decline rates, water handling, and drilling progress.
Capital expenditures may be affected by cost pressures associated with new
capital projects, including labour and material supply, project management,
drilling rig rates and availability, and seismic costs. These factors are
discussed in greater detail in filings made by Addax Petroleum with the
Canadian provincial securities commissions.
Readers are cautioned that the foregoing list of important factors
affecting forward-looking information is not exhaustive. Furthermore, the
forward-looking information contained in this news release is made as of the
date of this news release and, except as required by applicable law, Addax
Petroleum does not undertake any obligation to update publicly or to revise
any of the included forward-looking information, whether as a result of new
information, future events or otherwise. The forward-looking information
contained in this news release is expressly qualified by this cautionary
statement.
For further information: Mr. Patrick Spollen, Investor Relations,
Tel: +41(0)22-702-95-47, patrick.spollen@addaxpetroleum.com; Mr. Craig Kelly,
Investor Relations, Tel: +41(0)22-702-95-68, craig.kelly@addaxpetroleum.com;
Ms. Marie-Gabrielle Cajoly, Press Relations, Tel: +41(0)22-702-94-44,
marie-gabrielle.cajoly@addaxpetroleum.com; Mr. Nick Cowling, Press Relations,
Tel: +1-416-934-8011, nick.cowling@cossette.com; Mr. James Henderson,
Press Relations, Tel: +44(0)20-7743-6673, james.henderson@pelhampr.com; Mr.
Alisdair Haythornthwaite, Press Relations, Tel: +44(0)20-7743-6676,
alisdair.haythornthwaite@pelhampr.com
For further information: Mr. Patrick Spollen, Investor Relations, Tel: +41(0)22-702-95-47, patrick.spollen@addaxpetroleum.com; Mr. Craig Kelly, Investor Relations, Tel: +41(0)22-702-95-68, craig.kelly@addaxpetroleum.com; Ms. Marie-Gabrielle Cajoly, Press Relations, Tel: +41(0)22-702-94-44, marie-gabrielle.cajoly@addaxpetroleum.com; Mr. Nick Cowling, Press Relations, Tel: +1-416-934-8011, nick.cowling@cossette.com; Mr. James Henderson, Press Relations, Tel: +44(0)20-7743-6673, james.henderson@pelhampr.com; Mr. Alisdair Haythornthwaite, Press Relations, Tel: +44(0)20-7743-6676, alisdair.haythornthwaite@pelhampr.com
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