The Toronto-based mining exploration corporation International Pursuit announced Tuesday, February 12, that it has terminated the previously announced letter of intent to acquire a five percent interest in a joint venture relating to the East Wadi Araba Concession in Egypt.
The termination follows Persuit’s failure to obtain regulatory approval of the proposed transaction on terms acceptable to the parties. Pursuit continues to assess alternative transactions and will seek additional financing upon identifying an appropriate transaction, a company press release stated.
The Toronto Stock Exchange has required that Pursuit satisfy the Exchange that it meets certain continued listing requirements on or before March 26, 2002.
In mid-January, Pursuit signed a letter of intent to acquire the abovementioned interest in the joint venture, which holds a seven-year exploration lease of the concession. Under the terms of the agreement, Pursuit was given the option to increase its participation in the joint venture to 10 percent. The transaction was conditional upon the negotiation and settlement of definitive agreements and receipt of all necessary regulatory approvals.
The East Wadi Araba concession is located in the Gulf of Suez Sedimentary Rift Basin, which contains five major fields that, together, currently account for the majority of Egypt's oil production. These fields have produced more than five billion barrels of oil and have a reported three billion barrels of proved reserves. The Gulf has another 35 fields in production.
The 393-square-kilometer East Wadi Araba concession is located in the northwestern area of the Gulf, adjacent to the Warda field, which has produced 50 million barrels since its discovery in 1990, and has current recoverable reserves of 52 million barrels.
Among the fields to the east of the East Wadi Araba concession is the October Field with 1.5 billion barrels of recoverable oil. Several oil fields to the south contain an estimated 700 million barrels of recoverable oil.
The concession was earlier held by British Gas (BG), which spent $10 million in seismic studies. Seismic analysis by British Gas established 12 high-potential drilling targets, each with the potential of 50-100 million barrels. BG had relinquished the field in 1998 when oil was dropping down to $10 per barrel.
At the time of the singing Pursuit also announced a proposed private placement of up to 60,000,000 of its common shares at a price of $0.02 per share. A portion of the proceeds of the offering was to be used to acquire the interest in the East Wadi Araba Concession. The offering was also conditional upon receipt of regulatory and shareholder approval. — (menareport.com)
© 2002 Mena Report (www.menareport.com)
