Addax takes interest in Iraq

Addax Petroleum Corp., based in Calgary, Alberta, Canada, has taken a one-third interest in the Sangaw North production sharing contract in the Kurdistan region of Iraq. The purchase price comprises the reimbursement of Sterling’s past costs as well as funding the seismic campaign and the drilling of the first exploration well. The area is about 80km SE of the Taq Taq field, a joint venture between Addax and the Turkish Cukurova Group. The Sangaw North licence covers 492sq/km, with a number of surface oil seeps and an exploration well scheduled to be started in mid-2009. The production sharing contract is subject to an assignment to Korean National Oil Corp. which would reduce the Addax interest to 26.67%. Additionally, the Kurdistan regional government has the right to acquire a one-quarter stake in the property, which would further reduce Addax’s holding to 20%. Oil-company deals with the Kurdish government are deemed illegal by Iraq’s central government, but continue regardless.
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