New Oil and Gas Discovery in Libya

Oil Field

Calgary, Canada-based oil company Verenex Energy Inc says it has made an oil and gas discovery in Libya in the Ghadames Basin.

The find was made at the H1-47/02 new field wildcat ("NFW") exploration well in Area 47. The H1 discovery is the Company's tenth oil and gas discovery in Area 47 since drilling began in September 2006. The Libyan National Oil Corporation ("NOC") has also announced this discovery. The tests yielded a combined maximum measured flow rate, as restricted by test equipment capability, of approximately 1,315 bopd (gross) of light sweet crude oil and 16.2 mmcf/day (gross) of natural gas through choke sizes on particular intervals ranging from 32/64ths to 48/64ths inch. Measured API gravity of the crude oil ranged from 42 to 64 degrees.

Under the EPSA terms for Area 47, Verenex is the operator and holds a 50% working interest in the initial 5-year Exploration Period which reduces to 25% for any commercial developments retained in a subsequent 25-year Exploitation Period. These working interest levels reflect the Company's required share of capital funding during the periods. In any commercial development scheme, Verenex would fund 25% of capital expenditures and 6.85% of operating costs and receive an initial production allocation (free of all taxes and royalties) of 6.85%.

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