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Gulfsands Announces Oil Production Commences at Khurbet East Field

Source: www.gulfoilandgas.com 7/22/2008, Location: Middle East

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Gulfsands Petroleum announced that the production of oil commenced at the Khurbet East Early Production Facility in Block 26, Syria. This early commencement of oil production follows the fast tracking of construction of an EPF for the Massive Reservoir in the Khurbet East Field. The discovery well for the Khurbet East field, KHE-1, completed operations in June 2007.

Gulfsands, the Operator of Syria Block 26 and Dijla Petroleum Company, the jointly owned company established with Syria Petroleum Company to act as the "joint operating company" under the terms of the Production Sharing Contract for Block 26, completed the EPF less than six months after the receipt of approval from the Syrian Petroleum Company and the Government of Syria for the development of the Khurbet East Field. The commencement of production of oil is several months ahead of the development schedule contemplated at that time.

The first well brought into production is KHE-4, one of the three vertical wells to be tied into the EPF. The Company is now proceeding with un-loading and kick-off operations of the two horizontal wells (KHE-5H and KHE-6H) and will follow with the two remaining vertical wells (KHE-2 and KHE-3). The Company expects that it will take several weeks to complete these operations.

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