28/03/2008 - 15:09

Incremental Petroleum expands in Turkey

28/03/2008 - 15:09

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Incremental Petroleum Limited has announced that it has concluded the purchase all of a further 10 per cent equity in the Edirne licence in Western Turkey from one of its Turkish partners for US$1.5 million.

Incremental Petroleum Limited has announced that it has concluded the purchase all of a further 10 per cent equity in the Edirne licence in Western Turkey from one of its Turkish partners for US$1.5 million.

This acquisition takes IPM's stake in the project to 55 per cent.

Other participants on the Edirne Joint Venture are Otto Energy Ltd (ASX: OEL, 35%, unchanged) and local Turkish interests (10%).

The acquisition cost is $US1.5m, with two further contingent payments of $US0.5m each if gas sales volumes exceed 8.5 million cubic feet per day and 13 million cubic feet per day respectively from the licence over three month periods before 31 Dec 2010.

The purchased interest has the obligation to refund past costs from future production proceeds.

Incremental's General Manager Gerry McGann said, "The additional interest acquired today confirms Incremental's commitment to the Edirne project.

With the start of a five well drilling programme yesterday, and a fast track approach to commercialising discovered gas, the project has the capacity to add significantly to Incremental's Turkish cash flow."

IPM has been appointed Joint Operator by the Joint Venture. IPM is in the final stages of applying for a gas marketing licence on behalf of the Joint Venture, and is evaluating the sale of the produced gas with potential buyers.

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