Petrel Resources leapt 10% this morning after Managing Director, David Horgan, confirmed in a interview with Reuters that they had been “invited to negotiations reaffirming our title to Block 6”.
Petrel Resources first signed a working agreement over Block 6 in the western desert in Iraq in 2002 when Saddam Hussein was still in power. Since then the Company has worked to ensure its agreement is maintained under the new Iraqi government.
Earlier this week, over seventy companies, including Exxon Mobile, Royal Dutch Shell, BP and Total SA were invited to register for oil extraction and service contracts. Iraq holds the world’s third largest oil reserves, but is in need of a major investment program to take advantage of its vast oil wealth. Petrel Resources was one of the companies invited.
In an interview with Reuters, David Horgan said that he expected to go to Baghdad for talks in the coming weeks, and didn’t expect a problem in renegotiating their working agreement from 2002. He added that Petrel Resources was expecting to end up with a net stake interest in the block of between 25 – 35% and that the company is keen to mobilise seismic crews before drilling in early 2009. Block 6 is one of the least explored areas in Iraq, but is believed to hold as much 5 billion barrels of recoverable oil.