This farm out is subject to the following conditions precedent:
As previously announced, the Joint Oil shareholders have now approved the second Exploration Phase extension and are reviewing the request to appoint Viking as operator of the Joint Oil Block. Jack Schanck, President and CEO said, “Sonde is very delighted to have the Viking Group as our partners in the Joint Oil Block development. Their expertise in FPSOs, their strategic relationship with the Thome Group and financial capability will allow our joint venture to develop the Zarat Field, and explore the potential of the Joint Oil Block. We look to this joint venture as a long-term relationship and commitment to the people of Tunisia and our Joint Oil partners. Sonde will plan a series of investor calls and meetings in early 2013 to fully expand on the opportunity this agreement represents.”
Sonde earlier indicated that it has reached a tentative agreement with PA Resources, the Zarat license holder, on the unitization principles of the Zarat Field, which is located to the south of the Joint Oil Block. The definitive agreement will include principles to the Unit Area, Unit Plan of Development Area and Tract Participation. The Unit Plan of Development is on track for submission to the Tunisian Authorities and approval by the end of the second quarter of 2013. A detailed reservoir technical evaluation undertaken jointly by Sonde/Viking and PA Resources is ongoing. Preliminary results performed by Sonde indicate that the gas recycling is a viable production option. This may advance the project to initial cash flow as early as 2015.
Conrad Clauson, Chairman of the Viking Group, indicated “that Viking Energy Group is very pleased to establish a long-term partnership with Sonde for the exploration and development of the Joint Oil Block. We look forward to working with our partners with the objective to develop liquid hydrocarbon resources contained in the Zarat field within the next two years using an FPSO vessel, followed by the monetization of the gas resources.”
“The Viking strategy for the Zarat field is to develop it through a two staged process, appraise and develop it with the objective to be able to convert the prospective resources into reserves and then tie in each future discovery into the same FPSO vessel as the one we believe should be used for the Zarat field development.”
“The development of the Zarat field will have strong operational synergies with the development of the Isis field located offshore Tunisia and also operated by the Viking Energy Group.”
Although management believes that the expectations reflected in the forward-looking information or forward-looking statements are reasonable, prospective investors should not place undue reliance on forward-looking information or forward-looking statements because Sonde can provide no assurance those expectations will prove to be correct. Sonde bases its forward-looking statements and forward-looking information on information currently available and do not assume any obligation to update them unless required by law.