MOU signed with Ugandan govt

11 Oct 2006 07:01

Tullow Oil PLC11 October 2006 News release Tullow Oil plc - MOU signed with Ugandan Government 11 October 2006 - Hardman Resources, the operator of Block 2 in Uganda, in whichTullow Oil plc (Tullow) is a 50% partner, today issued the following pressrelease. Hardman Resources Limited through its wholly-owned subsidiary Hardman PetroleumAfrica Pty Ltd (collectively "Hardman"), operator of the Block 2 Joint Venture,is pleased to announce that the Government of the Republic of Uganda ("theGovernment"), Hardman and its co-venturer Tullow Oil plc, have signed aMemorandum of Understanding ("MOU") relating to future investment plans andlicence obligations for Block 2. The MOU includes commitments by both the Joint Venture and the Government toadvance appraisal and development activities to realise the full potential ofthe existing Block 2 discoveries and provide time for the continuing activeexploration of the remainder of the block. The next well in the 2006 exploration programme is Nzizi-1, an up dip appraisalwell to the south west of the Mputa discovery which is anticipated to spud byearly November. The Joint Venture will also undertake further 3D and 2D seismicsurveys to define the volumes of the existing discoveries better, develop infilllocations, as well as to explore the northern area of the block to identifyprospects for drilling in 2007 and 2008. In addition, the Joint Venture willcontinue to evaluate the most effective manner to drill offshore prospects inLake Albert by the end of 2007. In parallel with these exploration and appraisal activities, the Joint Ventureand Government have also agreed to review the early development potential ofhydrocarbons already discovered by commencing concept studies for an EarlyProduction System (EPS). This will determine the commercial and technicalfeasibility for early production. Any such development could initially compriseproduction and processing facilities to fuel a local power station (of around50MW capacity) and potentially also supplying a mini-refinery. Simon Potter, CEO & Managing Director of Hardman Resources, commented: "We appreciate the Ugandan Government's strong support for our operations sincethe oil discoveries at Waraga and Mputa. Confidence in the existing resourcebase and the market potential allows us to consider an Early Production Scheme.Further success in the planned exploration programme could lead to significantexpansion of domestic plans or an export option. We look forward to continuingto work closely with the Government to commercialise the oil found in Uganda tobenefit all stakeholders." Joint Venture Equities in Block 2 are:Hardman Petroleum Africa Pty Ltd (Operator) 50%Tullow Oil plc 50% Times and dates for Ugandan wells refer to Uganda time (GMT+3 hours), five hoursbehind Western Standard Time (Perth). For further information contact:Tullow Oil plc Citigate Dewe Rogerson Murray Consultants(+44 20 8996 1000) (+44 20 7638 9571) (+353 1 498 0300) Martin Jackson Joe MurrayTom HickeyChris Perry Tullow is a leading independent oil & gas, exploration and production group,quoted on the London and Irish Stock Exchanges (symbol: TLW) and is aconstituent of the FTSE 250 Index. The Group has interests in approximately 90exploration and production licences across 17 countries and focuses on threecore areas: NW Europe, Africa and South Asia. Tullow's NW Europe interests are primarily focused on gas in the UK SouthernNorth Sea where it has significant interests in the Caister-Murdoch System andthe Thames/Hewett areas and operates over 60% of its production. In Africa, Tullow has exploration and production in Gabon, Cote d'Ivoire, Congo(Brazzaville) and Equatorial Guinea and a large gas field development andappraisal programme in Namibia. Tullow also has exploration programmes inMauritania, Senegal, Cameroon, Uganda, Congo (DRC), Madagascar, Angola andGhana. In South Asia, Tullow has exploration and production in Pakistan and Bangladeshand high impact exploration activities in India. For further information please refer to our website at www.tullowoil.com ENDS This information is provided by RNS The company news service from the London Stock Exchange