Bankers Petroleum says that the Production Sharing Contract (PSC) for Block 'F' has been finalized.

As announced on December 4th, 2009, the main terms and conditions for a production sharing agreement for the Block 'F' exploration acreage application had been accepted by the National Agency of Natural Resources of Albania ('AKBN'). Negotiations to finalize the Production Sharing Contract have now concluded, and the agreement has been executed. An official signing ceremony was held in Tirana, Albania on April 9th attended by the Honorable Dritan Prifti, the Minister of Economy, Trade and Energy and Mr. Abby Badwi, President and CEO of Bankers.

Block 'F' is located immediately west of Bankers' Patos Marinza oilfield and covers an area of approximately 740 km2 (185,000 acres). Excluded from the area are three gas fields operated by Albpetrol Sh.a., the Albanian National Oil Company. The area contains several seismically defined structural and amplitude anomalies prospective for oil and natural gas as well as what the Company believes to be the western boundary of the Patos Marinza oilfield.

The Agreement requires a US$1 million signing bonus and has a seven year term with three exploration periods. Commitments on the block during the first exploration period of 3 years include US$1 million in expenditure for seismic and US$4 million for the drilling of two wells. Four additional wells and additional seismic will be undertaken in the subsequent exploration periods.

Upon commercial discovery of gas, the Agreement allows for development and production periods of 25 years plus extensions at the Company's option. The discovery of gas in this block will significantly enhance the economics of future thermal recovery projects at the adjacent Patos Marinza oilfield.

The Company has already commenced activities on seismic reinterpretation and plans to drill three wells on Block 'F' this year: one exploration well and two step-out vertical wells into the western extension of the Patos Marinza field.

Tags: Bankers Petroleum Ltd.