Arawak Energy Limited announces the acquisition, from a local Kazakh company, of a 100% interest in the Tamdykol exploration block (“Tamdykol”), located in the prolific Pre-Caspian hydrocarbon basin of Western Kazakhstan.
Tamdykol is located in the Emba oil and gas province approximately 260 km southwest of the city of Aktobe, in the Aktyubinsk Oblast. The contract for subsurface use was registered with the State Competent Body on January 20, 2000 and the contract is in the second extension of the exploration period, which runs until January 20, 2010. In late 2007, the area of Tamdykol was expanded from 5 sq km to 275 sq km (67,700 acres) to encompass several adjacent salt domes within the same petroleum system. Upon application to the Ministry of Energy and Mineral Resources, an evaluation period beyond January 20, 2010 may be granted in the event of a hydrocarbon discovery. Under the license terms, success in the remaining exploration period will be followed by the right to a 19 year production period. A post pay out 10% royalty interest is held by local investors.
Tamdykol is prospective for both shallow, suprasalt Jurassic and Triassic oil reservoirs, similar to those being exploited by Arawak at the Akzhar and Besbolek fields, and deeper Permo-Triassic oil reservoirs trapped by salt overhangs. Oil shows were first detected at surface, near the salt flats of Lake Tamdykol in 1912.
In 2008, Arawak plans to acquire 300 km 2D and 50 sq km 3D seismic with the intention of identifying well locations for drilling in Q1 and Q2 2009. The acquisition costs of Tamdykol and the associated capital programme in the exploration phase are expected to be approximately US$10 million.
Alastair McBain, President and Chief Executive Officer of Arawak, said: “The acquisition of the Tamdykol block provides an additional large acreage position, under attractive pre-2004 fiscal terms at a reasonable cost. The Company intends to explore for the same suprasalt, multi-zone oil reservoirs that we are successfully appraising and developing at Akzhar, Besbolek and Alimbai. The oil seeps at surface indicate that an active petroleum system is present. We are excited about our aggressive exploration plans for this block.”