Canadian Superior Energy announced today what it calls its "Oasis" Project, referring to the Company's entry into North Africa. Oasis commenced with the formal signing ceremonies for the offshore "7th of November Block" Exploration and Production Sharing Agreement (EPSA) that were conducted Wednesday, August 27, 2008, in Tunis, Tunisia. Canadian Superior and the Tunisian/Libyan company, Joint Exploration, Production, and Petroleum Services Company also signed a "Swap Agreement" awarding an overriding royalty interest and optional participating interest to Joint Oil, in Canadian Superior's "Mariner" Block, offshore, Nova Scotia, Canada. This represents the first such agreement for either Tunisia or Libya. Joint Oil is owned equally by the Tunisian government via Entreprise Tunisienne d'Activites Petrolieres (ETAP) and the Libyan government via Libya Oil Holdings.
Under terms of the EPSA, Canadian Superior has been named Operator for the "7th of November Block" which comprises an area of approximately 1200 square miles (750,000 acres), located some 75 miles offshore the Mediterranean Gulf of Gabes, in water depths ranging from 250-375 feet. Nearly equal portions of the block fall within the territorial waters of each of Libya and Tunisia. Portions of the multi-prospect block lie along the productive trends of the very large El Bouri (Libya) and Ashtart (Tunisia) oil fields which are reported to have produced over 750 million barrels of oil and 250 million barrels of oil, respectively. The multi-TCF gas/condensate field, Miskar (Tunisia) is also located in an adjacent block. A number of highly prospective prospects have been identified on the "7th of November Block" by Joint Oil and Canadian Superior utilizing the large existing seismic database. These prospects represent a variety of geological plays and proved hydrocarbon systems.
The exploration work commitment for the first phase (4 years) of the 7 year Exploration Period will include three exploration wells, 300 square miles of 3D seismic, and one appraisal well. This appraisal well is intended to be the first well in a fast-track drilling program and will be a direct offset to two significant oil and gas discoveries drilled in the 1990's on a feature known as "Zarat" in the adjacent contract area. Based on 3D seismic acquired subsequent to the discoveries, a substantial portion of the undeveloped "Zarat discovery area" is interpreted to extend north, into the "7th of November Block". The primary proved oil, condensate, and gas reservoirs are anticipated at drilling depths around 9000 feet. Planning and rig contract discussions are already underway, targeting a two-well, back-to-back, drilling program likely commencing within the next 6 months. The initial exploration wildcat well will be drilled on a geologically-related seismic prospect (Fisal) located approximately 6 miles northeast of the Zarat appraisal well.
