Operations Update
(Thomson Reuters ONE) - Immediate Release 6 August 2009GULFSANDS PETROLEUM PLCOPERATIONS UPDATE:EARLY PRODUCTION FACILITY EXPANSION COMPLETEDKHURBET EAST PRODUCTION EXCEEDS 14,700 BOPDWORKOVER PROGRAMME COMMENCESLondon, 6th August 2009: Gulfsands Petroleum plc ("Gulfsands", the"Group" or the "Company" - AIM: GPX), the oil and gas production,exploration and development company with activities in Syria, Iraq,and the U.S.A., is pleased to announce the successful completion ofthe expansion of the processing capacity at the Khurbet East EarlyProduction Facility ("EPF") to approximately 18,000 barrels of fluidper day and to provide the following update on operations at Block26, Syria.EXPANSION OF BLOCK 26 EARLY PRODUCTION FACILITYThe planned expansion of the Khurbet East EPF has been completed withthe EPF now capable of handling approximately 18,000 barrels of fluidper day ("bfpd").Tie-in operations have also been concluded on the previously drilledKHE-9 and KHE-10 production wells coincident with the completion ofthe expansion of the EPF, with the result that gross daily productionfrom the Khurbet East Field has increased from approximately 10,730barrels of oil per day ("bopd") during the month of June toapproximately 14,700 bopd. The KHE-9 well is currently flowing atapproximately 2,100 bopd and KHE-10 well is contributingapproximately 1,900 bopd. As with the other production wells in theKhurbet East Field, these new wells are flowing oil with negligibleassociated water cut.Drilling operations on the KHE-11 horizontal well ("KHE-11") havealso recently been successfully concluded, and this well is awaitingtie-back to the EPF. The KHE-11 well was spudded on 20th June at asurface location approximately 700 metres to the east of the KhurbetEast discovery well KHE-1. KHE-11 is the third of three developmentwells planned to support the expansion of the Khurbet East EPF.The KHE-11 well was drilled to a total measured depth of 2235 metresor 1962 metres true vertical depth ("TVD") and encountered the top ofthe oil bearing Cretaceous Massive reservoir at 1945 metres TVD. Ahorizontal section of approximately 60 metres of Cretaceous MassiveFormation was penetrated within the uppermost portion of thereservoir. Reservoir properties encountered in the KHE-11 well-boreare consistent with those in the other high performance wells in thecentral portion of the Khurbet East Field, and this well isanticipated to produce oil at similar rates to the other productionwells located near the structural crest of the Field.KHURBET EAST FIELD DELINEATION WELLThe drilling rig has now moved on to drill well KHE-12, a delineationwell located near the currently interpreted southern limit of theKhurbet East structure. KHE-12 is located some 3.2 kilometres southof the previous delineation well KHE-8, which encountered a full oilcolumn. The objective of KHE-12 well is to provide structural andstratigraphic information which may lead to the extension of theKhurbet East Field into the southern tip of the Khurbet East faultblock structure and to locate the field-wide oil-water contact. TheKHE-12 well was spudded on 1st August, and drilling operations areexpected to be completed within approximately 45 days.WELL WORKOVER PROGRAMME COMMENCESOperations have commenced this week on a three-well workoverprogramme using a recently contracted workover rig. The multipleobjectives of the planned workover programme are to prepare theYousefieh-1 well as a future producer from the Yousefieh Field and toestablish continuous oil production to surface from the Yousefieh-2and KHE-7 wells which were drilled as delineation wells on theYousefieh and Khurbet East Fields, respectively.Wireline logs and core samples taken from the Yousefieh-2 and KHE-7wells suggest that the oil bearing reservoirs in these wells are ofrelatively poor quality and as such the oil volumes that have beenencountered at these well locations are not currently classified asreserves. However, a successful outcome from the workovers ofYousefieh-2 and KHE-7 wells may lead to additional reserves beingidentified.The workover programmes will involve well testing operationsinclusive of acid stimulation and artificial lift if required.Previous open hole testing conducted on the Yousefieh-2 well duringdrilling operations recovered oil to surface in the absence of acidstimulation, but in sub-commercial quantities.Workover operations will initially commence on the Yousefieh-2 welland be followed by the Yousefieh-1 well where a remedial cementoperation will be carried out. Following completion of work on theYousefieh wells the workover rig will then move to KHE-7 well tocommence testing operations.Ric Malcolm, Gulfsands CEO, said"The impressive performance from new development wells at KhurbetEast has resulted in an increase in field production from 10,700 toin excess of 14,700 bopd. With production well KHE-11 yet to come onstream, we remain on track to achieve our target of producing 16,000bopd by the end of the year."This release has been approved by Richard Malcolm, Chief Executive ofGulfsands Petroleum Plc who has a Bachelor of Science degree inGeology with 29 years of experience in petroleum exploration andmanagement. Mr. Malcolm has consented to the inclusion of thetechnical information in this release in the form and context inwhich it appears.For more information please contact:Gulfsands Petroleum (London) +44 (0)20 7434 6060Richard Malcolm, Chief Executive Officer +44 (0)7733 001 002Kenneth Judge, Director of Corporate Development& CommunicationsBuchanan Communications Limited (London) +44 (0)20 7466 5000Bobby MorseBen RomneyRBC Capital Markets (London) +44 (0)20 7653 4667Sarah WharryABOUT GULFSANDS:Gulfsands is listed on the AIM market of the London Stock Exchange.SyriaGulfsands owns a 50% working interest and is operator of Block 26 inNorth East Syria. The Khurbet East oil field was discovered in June2007 and commenced commercial production within 13 months of thediscovery. This field is producing at a production rate ofapproximately 14,700 barrels of oil per day through an earlyproduction facility. Block 26 covers approximately 8,250 squarekilometres and encompasses existing fields which currently produceover 100,000 barrels of oil per day, and are operated mainly by theSyrian Petroleum Company. The current exploration license expires inAugust 2010 and is extendable for a further two years. Gulfsands'working interest 2P reserves in Syria at 31 December 2008 were 35.2million barrels of oil.IraqGulfsands signed a Memorandum of Understanding in January 2005 withthe Ministry of Oil in Iraq for the Maysan Gas Project in SouthernIraq, following completion of a feasibility study on the project, andis negotiating details of a definitive contract for this regionallyimportant development. The project will gather, process and transmitnatural gas that is currently a waste by-product of oil productionand as a result of the present practice of gas flaring, contributesto significant environmental damage in the region. The Company isactively engaged in discussions with respect to financing andpotential equity partners. Gulfsands has no reserves in Iraq.Gulf of Mexico, USAThe Company owns interests in 44 blocks comprising approximately138,000 gross acres offshore Texas and Louisiana, which include 30producing oil and gas fields with proved and probable workinginterest reserves at 31 December 2008 of 5.1 million barrels of oilequivalent.Certain statements included herein constitute "forward-lookingstatements" within the meaning of applicable securities legislation.These forward-looking statements are based on certain assumptionsmade by Gulfsands and as such are not a guarantee of futureperformance. Actual results could differ materially from thoseexpressed or implied in such forward-looking statements due tofactors such as general economic and market conditions, increasedcosts of production or a decline in oil and gas prices. Gulfsands isunder no obligation to update or revise any forward-lookingstatements, whether as a result of new information, future events orotherwise, except as required by applicable laws.More information can be found on the Company's websitewww.gulfsands.com---END OF MESSAGE---This announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.
Datum: 06.08.2009 - 08:00 Uhr
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