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LONDON (Alliance News) - Empyrean Energy PLC on Monday said it signed a petroleum contract with oil company CNOOC Group for block 29/11, located in the Pearl river mouth basin, offshore China.
The oil & gas explorer holds a 100% working interest in the block with CNOOC holding an option to obtain up to 51% working interest upon a commercial discovery.
The company expects to begin the contract on December 13.
Under the first phase of the deal, which is planned for two and a half years, Empyrean Energy will drill one exploration well to a depth of 2,500 meters or to the Basement formation.
Under the contract, Empyrean Energy said it has the option of entering the second phase of development after relinquishing 25% of the current area.
The second phase has a commitment of drilling one additional exploration well to a depth of 2,500 meters or to the Basement formation within a further two-year timeframe.
"Entering into the petroleum contract marks an important milestone for the company with regards block 29/11," said Chief Executive Tom Kelly.
"We are looking forward to drilling one of the exciting, potentially company transformational prospects that we have identified via the recently acquired 3D seismic," added Kelly.
Shares in Empyrean Energy were trading 4.2% higher on Monday at 9.25 pence each.
