Pancontinental, Hardman: Eritrean MOU null and void

Pancontinental, Hardman: Eritrean MOU null and void

Sydney, Jan 04, 2005 (RWE via COMTEX) -- (RWE Australian Business News)
Pancontinental Oil & Gas NL and joint venture partners, Afrex Ltd and Hardman Resources Ltd today announced a memorandum of understanding negotiated with the Eritrean Ministry of Energy and Mines for the offshore Red Sea Massawa Block had been declared null and void.

The MOU was initially for a six-month period commencing on December 24 2003.

"A number of extensions have been granted since that date to enable continued negotiations with the ministry for a Petroleum Sharing Contract (PSC).

"The final draft of the PSC was submitted to cabinet for ratification," Pancontinental said.

"Notification has now been received from the ministry that the MOU and any other documents relating to the Massawa Block have been declared null and void," the company said.

Afrex Ltd, as operator of the joint venture, is now seeking discussions with the Eritrean authorities for an explanation and clarification of the situation.

The announcement was made after the close of trading.

Shares in Pancontinental today rose 0.2c to 9.5c and Hardman 2c to $1.59.

Today's announcement follows a report last September from Sub-Sahara Resources NL that its exploration activities in Eritrea had been suspended after a directive from the minister of energy and mines.

"Sub-Sahara and all other foreign companies conducting exploration in Eritrea received written notice from the minister to cease all exploration activities immediately," directors said at the time, adding that they had sought an explanation from the minister.

Sub-Sahara told its annual meeting on November 30 that there had been no futher correspondence from the government. Freerealtime.com