OilVoice - Sea Dragon Completes Acquisition of Premier Oil Egypt

Sea Dragon Completes Acquisition of Premier Oil Egypt

Sunday, December 27, 2009

Sea Dragon Energy Inc. has completed the acquisition of all of the issued and outstanding shares of Premier Oil Egypt (NW Gemsa) B.V.

The acquisition, which was announced on August 19, 2009 when Sea Dragon signed a sale and purchase agreement with Premier Oil Overseas B.V, gives Sea Dragon a 10% working interest in the NW Gemsa Concession, located approximately 300 km south east of Cairo. The other two partners in the concession are the operator, Vegas Oil and Gas S.A. (50% working interest) and Circle Oil Plc (40% working interest).

The effective date of the acquisition is July 1, 2009. The total consideration paid of $US 14.7 million includes the purchase price of $US 12.5 million plus working capital adjustments to December 21, 2009. The Company is entitled to receive its 10% share of production revenues after July 1, 2009. For the months of July to October, Sea Dragons' share of net revenues after taxes and royalties totalled $US1.0 million.

The NW Gemsa concession is in the midst of a nine well development program of the Al-Amir and Geyad areas. Five wells have been brought onto production in the Al-Amir and Geyad development leases since February 2009 and gross daily production reached 6,170 bopd in November. Cumulative production from the concession since it began producing in February 2009 is now over one million barrels. The sixth well in the concession is in progress and three more wells are to be completed before the end of 2010.

Commenting on the closing of the acquisition Premier Oil Egypt (NW Gemsa) B.V. and Sea Dragon's involvement in the NW Gemsa property, Mr. Said Arrata, Chairman and CEO said:
'We are very pleased to have concluded this acquisition. The NW Gemsa property is very exciting for us and we have high expectations for the completion of the development program and possible additional exploration potential.'

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