Gulfsands Petroleum Regulatory News (GPX)

25 Jul 2006 07:02

Gulfsands Petroleum PLC25 July 2006 25 July 2006 Gulfsands Petroleum plc("Gulfsands" or "the Company") Gulfsands Appoints Andrew West as Non-Executive Chairman Gulfsands Petroleum plc (symbol GPX), the AIM listed oil and gas exploration,development and production company with activities in the USA, Syria and Iraq,is pleased to report that the Company has appointed Mr. Andrew West, one ofGulfsands' current non-executive directors, as non-executive Chairman of theBoard. Effective today, Andrew West was appointed as the non-executive Chairman of theBoard. Mr. West brings a high level of experience from his career as aninvestment banker and former Chairman of Sibir Energy PLC. Andrew West (48), a British subject and resident, is an investment banker withnearly twenty-five years experience in London and New York. During his earlycareer he worked from 1981 to 1985 as a Vice President of Smith Barney & Co.,and from 1985 to 1990 as an Executive Director of Lehman Brothers Limited,specializing in mergers and acquisitions. From 1990 to 1997 Mr. West was aDirector of Guinness Mahon & Co. Limited and a Managing Director of itsCorporate Finance Division and from 1997 to 1999 was Managing Director of StrandPartners Limited, a privately-owned investment banking firm. For the past several years Mr. West has worked independently and he is currentlya non-executive director of several companies, including Bellamy's of BrutonPlace Limited, a restaurant company, CLP Envirogas Holdings Limited, a renewableenergy company, First City Insurance Group Limited, an insurance broker, andAbacus Syndicates Limited, a Lloyd's Managing Agency. Mr. West has hadconsiderable previous experience advising in the oil and gas sector, includingplaying a significant role in the establishment of Sibir Energy PLC, an AIMlisted oil and gas company with interests in Western Siberia, of which he wasChairman for two years. As Chairman, Andrew West will receive annual compensation of £50,000 and hasbeen granted options on 24 July 2006 over a further 75,000 ordinary shares of5.714p each at £1.04 per share, exercisable by 24 July 2011. Mr. West waspreviously granted options on 13 February 2006 over 125,000 ordinary shares of5.714p each at £1.445 per share, exercisable by 13 February 2011. The Company plans to recruit a third non-executive director in the near term tobalance representation on the board with three executive and three non-executivedirectors. John Dorrier, CEO of Gulfsands Petroleum, said: "Since his appointment as a Director in February this year, Mr. West has takenan active and constructive role on the Company's Board. In his new position asChairman, we believe he will expand this role with a greater emphasis on workingwith our shareholders and institutional investors." Enquiries: Gulfsands Petroleum (Houston) 001-713-626-9564David DeCort, Chief Financial Officer College Hill (London) 020-7457-2020Nick ElwesPaddy Blewer Teather & Greenwood (London) 020-7426-9000James Maxwell (Corporate Finance)Tanya Clarke (Specialist Sales) Note to Editors • Gulf of Mexico, USA The Company owns interests in 64 offshore blocks comprising approximately216,000 gross acres which includes 39 producing oil and gas fields offshoreTexas and Louisiana with proved and probable recoverable reserves of 32.4 BCFGE,consisting of 19.8 BCFG and 2.1 MMBO as of 1 January 2006 with a net presentvalue of $183 million. Additionally, there is a further 2.8 BCFGE of possiblerecoverable reserves with a net present value of $15.8 million. • Syria In Syria, Gulfsands owns a 50% working interest in Block 26 and is the operator.The block covers 11,000 square kilometres and surrounds areas which currentlyproduce over 100,000 barrels of oil per day from existing fields. In January2006 the Company completed the acquisition of 1,155 kilometers of 2D seismic andanticipates drilling two wells during 2006. The first well, known as SouediehNorth, commenced drilling in late April 2006 and was temporarily suspended inJune for further analysis. The second well known as Tigris is scheduled to spudin late August of 2006 and has the potential to contain in excess of 500 MMBOE.Gulfsands has identified 31 total exploitation and exploration prospects withinBlock 26 with mean resources potential exceeding 1 billion barrels ofrecoverable oil. Ryder Scott completed a reserves study on the Tigris structure in 2006 and thesereserves were classified as either oil or gas bearing until such time as theCompany drills and tests the Tigris structure. As of 1 July 2006 Ryder Scottdetermined that the Probable Reserves net to Gulfsands after applying the termsof the Production Sharing Contract is 102 BCFG with a net present valuediscounted at 10% of $233 million. For primarily a natural gas accumulation, anadditional 75 BCFG of possible reserves net to Gulfsands were estimated to havea 10% discounted net present value of $261 million. Furthermore, the Companycompleted its own economic evaluation on the Prospective Gas Resource and hasestimated that Prospective Gas Resource net to Gulfsands is 577 BCFG with a netpresent value of approximately $1.06 billion. In summary total gas reservespotential net to Gulfsands among Probable and Possible Reserves for the naturalgas case is 177 BCFG (30 MMBOE) with a net present value of $494 million andwhen combined with the Prospective Gas Resource it totals 754 BCFG (126 MMBOE)with a net present value of approximately $1.55 billion. For primarily an oil accumulation, Ryder Scott determined the Possible Reservesnet to Gulfsands after applying the terms of the Production Sharing Contract are19.4 million barrels of oil having a net present value discounted at 10% of $452million. Furthermore, the Company completed its own economic evaluation on theProspective Oil Resource and has estimated that Prospective Oil Resource net toGulfsands is 50.9 MMBO with a net present value of approximately $1.51 billion.In summary total oil reserves potential net to Gulfsands among Possible andProspective Oil Resource for the oil case is 70.3 MMBO with a net present valueof approximately $1.96 billion. • Iraq Gulfsands signed a Memorandum of Understanding in January 2005 with the Ministryof Oil in Iraq for the Misan Gas Project in Southern Iraq and is currentlynegotiating the definitive contract for the project. The project will gather,process and transmit natural gas that is currently a waste by-product of oilproduction in the region and will end the environmentally damaging practice ofgas flaring. Gulfsands has completed a feasibility study and expects to conductfurther technical work and commercial discussions with the Iraq Oil Ministry. • Onshore USA Gulfsands operates onshore in the USA through its 83% owned subsidiary companyDarcy Energy LLC. As of 1 January 2006, Darcy Energy owned interests in two oiland gas fields onshore Texas, USA (Emily Hawes and Barb Mag) with proved andprobable recoverable reserves of 1.6 BCFGE, consisting of 1.2 BCFG and 58,000barrels of oil with a net present value of $9.5 million. Additionally, there isa further 2.2 BCFGE of possible recoverable reserves with a net present value of$7.9 million. This information is provided by RNS The company news service from the London Stock Exchange