Gold Point Energy Announces LOI on Bulgaria Gas Project
Gold Point Energy Corp. (the “Company” or “GPE”) (TSX VENTURE: GPE)(FRANKFURT WKN # A0HGQ1) reported today that it has entered into a Letter of Intent with JKX Oil & Gas PLC (“JKX”) and Aurelian Oil & Gas PLC (“Aurelian”) to farm-in to a portion of two oil and gas licenses comprising 1,480 square kilometers (365,520 acres) in eastern Bulgaria. GPE has agreed to pay 40% of a 250 square kilometer 3D seismic survey plus 40% of the cost of two shallow test wells to earn a 20% working interest in the block. GPE’s obligation to pay 40% of the seismic and drilling costs is subject to a cap of $5.0 million, after which it pays 20% of the costs.
The farm-in block is located onshore in eastern Bulgaria along the Black Sea coast. The primary objective on the block is shallow Tertiary age (Eocene and Oligocene) sandstone reservoirs in the Varna Trough of the Western Black Sea Basin. The potentially productive Tertiary sediments cover an area of approximately 500 square kilometers, which is completely covered by the JKX and Aurelian licenses. Previous exploration drilling conducted between 1957 and 1979 by the former Bulgarian state-owned oil and gas company, Comgeo, resulted in numerous wells with promising gas tests despite the use of primitive, overbalanced drilling techniques. Of seventy-seven wells drilled, three were completed as producing wells, forty-four encountered producible gas, and sixteen had good gas shows. Due to the lack of market for gas at the time the wells were drilled, the basin was left almost completely undeveloped. This Tertiary basin represents an opportunity to apply 3D seismic exploration techniques that were originally developed in the US Gulf Coast and recently applied to the Pannonian Basin of Hungary with great success.
Under the terms of the Letter of Intent, GPE has agreed to pay 40% of the costs associated with a 250 square kilometer 3D seismic survey (“the 3D Survey”) of the eastern area of the Golitza B and B1 Licenses (“the Eastern Golitza Area”). The current estimate of the cost of the 3D Survey is US$7.5 million. GPE’s share of that US$7.5 million would be US$3.0 million. Data acquisition for the 3D Survey is scheduled to commence in September, 2008, and be completed by year-end. The processed seismic data is expected to be available to GPE in early Q2-09. Within three months of receipt of the processed seismic data GPE will make an election to obtain a 20% participating interest in the Eastern Golitza Area and continue in the project; or exit the project if it considers that the results of the 3D Survey are unfavourable.
If GPE elects to continue in the project it shall then be responsible for 40% of the cost of drilling and completing, or plugging and abandoning, the two exploration wells that are to be drilled in the Eastern Golitza Area by the end of Q4 2009 until such time as GPE’s cumulative investment in the 3D Survey and the two exploration wells shall total $5.0 million; thereafter GPE will be responsible for only 20% of any additional project costs.
GPE’s participation in the proposed transaction is subject to obtaining TSX Venture Exchange approval.
JKX Oil & Gas PLC is a FTSE 250 exploration and production company. Listed on the London Stock Exchange under the symbol “JKX”, the Company’s principal interests are located in Ukraine and Russia, with additional interests in Georgia, Bulgaria, Hungary, Slovakia, Turkey and USA. In Ukraine JKX is active through its wholly-owned subsidiary, Poltava Petroleum Company (“PPC”), which is the largest non-state producer of oil and gas in the country. JKX acquired the enterprise Yuzhgazenergie (YGE) in a US$50 million transaction during 2007; YGE holds the licence to redevelop the 34.7 square kilometer Koshekhablskoye gas field, located in the Republic of Adygea in southern Russia. During fiscal year 2007 JKX produced an average daily rate of 12,579 barrels of oil equivalent (BOE), generating total revenue of US$184.5 million, cash flow of US$119.9 million, and profit of US$113.3 million.
Aurelian Oil & Gas PLC is an exploration and production company listed on the London AIM Exchange under the symbol “AUL”. Aurelian was founded in December 2002 to focus on the established oil provinces in the central European countries of the former CIS where there had been little investment in seismic and drilling technology during the previous 20 years. The Company has since developed rapidly from a pure exploration company into its present position with a wide portfolio of concessions in Poland (5), Slovakia (3), Romania (5) and Bulgaria (2), and a range of production, appraisal and exploration projects. Aurelian has a 90% interest in a recent discovery located southwest of Poznan, Poland which tested a culmination mapped within the Siekierki structural trend at approximately 3,900 meters depth. The well found a 90 meter gas column in Rotliegendes sandstone pay, which was subsequently tested at 7.6 MMscf/d. A third party Competent Persons Report conducted by RPS Energy on the Siekierki gas accumulation indicates 2C contingent resources of 190 BCF with an estimated net present value (10% discount rate) of EUR 263 million net to Aurelian.
Gold Point Energy Corp. is engaged in the development of oil and gas projects in the U.S., South America and Europe. The Company has experienced technical and management professionals, which provide a high level of expertise to oil and gas project development, as well as good access to industry contacts and quality projects.
ON BEHALF OF THE BOARD
Jack S. Steinhauser, President & CEO
Certain statements contained in this press release may be considered as “forward looking”. Such “forward looking” statements are subject to risks and uncertainties that could cause actual results to differ materially from estimated or implied results. These forward-looking statements are identified by their use of terms and phases such as “believe”, “expect”, “plan”, “anticipate” and similar expressions identifying forward-looking statements. Investors should not rely on forward-looking statements because they are subject to a variety of risks, uncertainties and other factors that could cause actual results to differ materially from the Company’s expectations, and expressly does not undertake any duty to update forward-looking statements. These factors include, but are not limited to the following: the Company’s ability to obtain additional financing, geological, mechanical or difficulties affecting the Company’s planned geological work programs, uncertainty of estimates of mineralized material and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
Contacts: Gold Point Energy Corp. Val Donovan Manager, Corporate Communications 1-877-741-1217 or (604) 641-1216 Email: firstname.lastname@example.org Website: www.goldpointenergy.com
SOURCE: Gold Point Energy Corp.