Perth, June 30, 2009 (ABN Newswire) - Kairiki Energy Limited (ASX:KIK)(PINK:KAIRF) has been advised by Focus Oil and Gas Pte Ltd that as it is unable to meet the required condition precedent of concluding its investor contracts to fund their obligations under the Farm-out Agreement dated 30 April 2009, the agreement will lapse as of today.
Following the recent oversubscribed placement to sophisticated investors and institutions, Kairiki's cash position at 30 June 2009 is very strong having recently raised approximately A$8.1 million.
These funds will provide Kairiki with the financial capability to pursue the development of its Tindalo oil discovery in the Philippines in the near term as previously announced, with the flexibility of retaining its 40% interest in the inboard portion of SC54.
About Kairiki Energy Limited
Kairiki Energy Limited (ASX:KIK)(PINK:KAIRF) is an Australian Based junior international oil and gas exploration and production company focussed on the Philippines. Kairiki holds a 30.1% interest in Service Contract 54A and a 40% interest in Service Contract 54B.
SC 54A measures 862 km2 and contains the Tindalo, Yakal, Nido 1X1 and Signal Head oil discoveries as well as a substantial portfolio of similar low-risk reefal prospects. In December 2009, Kairiki announced that the SC 54A Joint Venture had approved the development of the Tindalo field. The Tindalo development utilises a jack-up rig and a dynamically positioned storage vessel. Following a short project execution period, the Tindalo development tested oil at 18,689 bbls/d at the end of May 2010. Since that time, unexpected early water ingress to the well has resulted in the SC 54A Joint Venture preparing for a well re-entry and remediation programme to reduce or eliminate the water production. Based on a successful development at Tindalo a number of follow-up developments may be considered in SC 54A.
SC 54B measures 3184 km2 and contains the Gindara prospect which has a mean unrisked oil in place volume estimated by the Operator, of 634 million barrels. The Gindara prospect is a very large simple four-way closure at the Top Nido Limestone reservoir objective with an areal extent of 28 km2, a vertical closure of over 300m and is well located to receive hydrocarbon charge from the Palawan Trough. Kairiki is seeking to farm down its interest in SC 54B to accelerate drilling of the Gindara prospect.
Contact
Laurie Brown Managing Director Kairiki Energy Limited TEL: +61-8-9388-6711
Kairiki Energy Limited
