CORP / Arakis Reports on Annual General Meeting
NASDAQ SYMBOL: AKSEF
JUNE 17, 1998
CALGARY, ALBERTA--Arakis Energy Corporation (NASDAQ: AKSEF)
announced today that the board of directors of the Company was
increased from 9 to 11 members at the Annual General and Special
Meeting of Shareholders held on June 16, 1998. The present
directors were re-elected along with two new directors - Ian H.
Lundin and Fred C. Coles. The Company gave an operational report
highlighting progress of the pipeline construction, which
commenced on May 4, 1998 and continues on schedule at eight
separate locations along the pipeline route. As well, the Company
reaffirmed its expectation that the Consortium would meet its
scheduled date for start-up of mid-1999, at a production rate of
150,000 barrels of oil per day.
Arakis also said today that it has recently been involved in
discussions with the Government of Sudan concerning the Company's
management strategy for its Sudan Project. The Government
expressed certain concerns through a sixty-day notice of possible
termination that was subsequently withdrawn after productive
discussions with Company officials. The Notice asserted that
State, a wholly owned subsidiary of Arakis, and Arakis had
proceeded with management changes in contravention of the
Exploration and Production Sharing Agreement ("EPSA") and that
State was required to correct the default or the Government would
exercise its right to terminate the EPSA. The Notice referred to
a letter dated March 2, 1997 whereby State had assured the
Government that the structure and management of State and Arakis
would not be subjected to substantial changes or reorganization.
The letter also confirmed that State would do everything possible,
subject to applicable law, to preserve the rights and interests of
the Government in continuing the management and direction of
Arakis and State to achieve the scheduled start-up date of the
Project. Senior management of Arakis will visit the Sudan next
week to review progress on the Project and to reconfirm full
compliance by the Company with all Project agreements.
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