Soco has today announced that its subsidiary, Soco Exploration (Thailand) Co. Ltd, has signed a Participation Agreement with GFI Oil and Gas Thailand Inc, and TOPoil LTD, wherein the farmees can earn up to a 60% working interest in the Bualuang field in the Gulf of Thailand.
A 20% interest can be earned by the farmees upon the conclusion of a Phase I work programme wherein the farmees must conclude a high-resolution 100-kilometre 2D seismic programme and drill one well in the Bualuang Field. At the election of farmees, a further 40% working interest can be earned in the Phase II work programme.
The Phase II work programme, during which Soco Thai would fund only 8% of the cost, requires the farmees to drill up to eight wells, install a platform and take the project to first oil.
After the end of the Phase II Period, GFI shall be designated the operator of the project and shall engage an independent reservoir engineer to perform an analysis of the proven reserves contained in the Bualuang Field. The farmees shall pay Soco Thai an amount equal to one dollar (US$1) for each barrel over ten million four hundred thousand (10,400,000) barrels.
The assignment of interests in the agreement is still subject to approval of the appropriate regulatory authorities of the Government of Thailand.
Ed Story, chief executive of Soco, commented, 'This is a transaction that benefits all the parties involved. It allows Soco to focus resources on higher profile projects in Vietnam and Yemen, but can accelerate the development of our Thailand project and provide meaningful production as early as the end of 2007.'
Soco holds its interests in Thailand through its wholly owned subsidiary Soco Thailand, LLC., which in turn has a 99.93% shareholding in Soco Thai. Soco Thai holds a 100% working interest in the Bualuang Field (formerly Pornsiri) in the Gulf of Thailand over which it acquired government approval for a field development licence in March of this year.
GFI is a subsidiary of GFI Oil and Gas Corporation, a company incorporated in Alberta, Canada, traded on the Toronto Venture Exchange.
