Uganda - Agreement With Orca

28 Aug 2007 13:51

Tower Resources PLC28 August 2007 PRESS RELEASE28 August 2007 TOWER RESOURCES AND ORCA EXPLORATION JOIN FORCES IN UGANDA Tower Resources ("Tower"), the AIM listed oil and gas exploration company, andits wholly-owned subsidiary Neptune Petroleum (Uganda) Limited ("Neptune") havereached agreement with Orca Exploration Group Inc. ("Orca"), a Toronto TSXVenture Exchange quoted oil company. Orca will have an option to fund 83.33% ofthe expected cost of a commitment programme of seismic and two exploration wellsto earn a 50% interest in Exploration Area 5, north western Uganda. Theexploration area is currently licensed 100% to Neptune. Under the terms of the agreement, Orca will fund 83.33% of certain back costsand a 2D seismic programme of 250-300 kilometres, expected to begin this comingSeptember, which fulfils the commitment of Neptune Petroleum relating to thefirst exploration period of the EA5 licence. On completion of the interpretation of the seismic data, Orca will have theexclusive option to be assigned a 50% working licence interest in return forcontinuing to fund 83.33% of two exploration wells, expected to begin inmid-2008. Orca's financial contribution relating to the licence commitments islimited to maximum amounts of US$5 million in respect of the seismic programmeand an additional $10 million in respect of drilling and, if successful, $5million in respect of testing the two wells. In the event that Orca exercises its option to become a 50% partner, Neptunewill continue to remain operator under the licence for a period of three years.However, Orca will assume management responsibility for all drilling activities.Orca operates the Songo Songo gasfield in Tanzania. Its principal corporateoffice and operating base is in Dar-es-Salaam. Tower's Executive Chairman, Peter Kingston, has welcomed the future involvementof Orca as a potential 50% partner in EA5. He said: "Orca has the same cultural philosophy as Tower in the approach to conductingbusiness in a community-friendly manner. Its significant experience of managingoperations successfully in Tanzania and its belief in combining the strengths ofboth parties in the management of business activities will be very positive forboth sets of shareholders. Uganda is entering a very exciting phase in itsdevelopment as a new oil province and both Tower and Orca are looking forward tobeing a significant part of its future." End For further information, please contact: Tower Resources plc www.towerresources.co.ukPeter Kingston, Executive Director 01985 211780 Blue Oar SecuritiesRhodri Cruwys 020 7448 4400 Aquila Financial Limited www.aquila-financial.comPeter Reilly 020 7202 2600Yvonne Fraser Notes to Editors Tower Resources Plc is an AIM-listed, independent oil and gas explorationcompany based in London. The company is focused on sub-Saharan Africa, holding 100% exploration licencesin Namibia and Uganda through its two operating subsidiaries Neptune Petroleum (Namibia) Ltd and Neptune Petroleum (Uganda) Ltd. The company's assets include; blocks 1910A, 1911 and 2011A offshore Namibia andonshore block 5 in Northern Uganda. This information is provided by RNS The company news service from the London Stock Exchange