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Gold/Mining/Energy : KERM'S KORNER -- Ignore unavailable to you. Want to Upgrade?

To: Kerm Yerman who wrote (12734)	10/8/1998 2:04:00 PM
From: SofaSpud	Respond to of 15196

CORP. / Black Sea increases Peru stake Black Sea Energy Exercises Option and Increases Interest in Block 71 Project in Peru CALGARY, Oct. 8 /CNW/ - Chairman David Martin announced today that the Directors of Black Sea Energy have approved the exercise of an option to acquire an additional 25% share of Pangaea Energy International's interest in the Block 71 project in Peru's Ucayali Basin. The acquisition raises Black Sea's share of the project to half of Pangaea's current 88% interest. The remaining 12% interest in Block 71 is held by Murphy Oil Corporation, of Arkansas. Murphy's interest is being carried until the first well is completed, at which time it will either revert to a 12% working interest or will be relinquished, at Murphy's option. Black Sea's acquisition of the option was approved by 99.6% of the disinterested shareholders who voted at a special meeting on September 30th. By exercising the option, Black Sea has agreed to incur the balance of the costs associated with completing the initial Shahuinto well on Block 71, up to a maximum of US$7.5 million. Given current estimates for well completion, Black Sea's aggregate investment in Block 71 will be US$15 millions which will equal Pangaea's expenditures to date. Pangaea has budgeted a total of approximately US$30 million for all its work to date and to complete the Shahuinto well, which is expected to spud approximately November 1st. Black Sea President Gerry Burrows reported that Pangaea has begun mobilizing the drilling rig and related field equipment for the well. ''Our increased interest in Block 71 is a major step aimed at creating shareholder value by refocusing Black Sea's activities to ensure geographical diversification and to access new opportunities for growth.'' The Shahuinto prospect is a seismically-defined, 57,000-acre, four-way closed structure within Block 71, which covers a total of 2.5 million acres. (See accompanying property map (x)). Block 71, which follows the Peru-Brazil border on the east, is surrounded on the Peruvian side by a cluster of exploration blocks held by major international oil companies Shell, Mobil, Esso, Chevron, Phillips, Arco, Repsol, Anadarko and Elf. The large Ucayali basin contains established petroleum reserves, including the giant Camisea gas and condensate field, which is 150 kilometres south of Block 71. Occidental Petroleum, which has discovered 13 oilfields in Peru, found oil in several zones with its La Colpa exploration well in the late 1980s. The La Colpa well, which was not commercially developed, is about 25 kilometres west of Pangaea's Shahuinto wellsite. Black Sea's common shares trade on the Toronto Stock Exchange under the symbol BSX. ((x)Note: Readers of electronic news services may receive a faxed copy of the Block 71 property map by calling the Black Sea Energy office in Calgary, Canada, at (403) 269-2871). -0- 10/08/1998 For further information: Gerry Burrows in Calgary, (403) 269-2871; or Peter Meredith in Vancouver, (604) 688-7166