Repsol-YPF and PetroFalcon announce Gulf of Venezuela partnership

Repsol-YPF and Vinccler Oil and Gas, the wholly-owned subsidiary of PetroFalcon, announced the signing of a farm-in agreement on the Cardon IV Block in the Gulf of Venezuela.
Repsol and Vinccler recently signed a letter of intent whereby Vinccler will acquire a 25 % working interest from Repsol in the offshore natural gas license for the Cardon IV Block. Under the terms of the agreement, Repsol will keep a 25 % interest.

ENI, an Italian integrated oil and gas company, holds the remaining 50 % interest, and Petroleos de Venezuela (PdVSA), the Venezuelan state-owned oil and gas company, retains the right to acquire up to 35 % of the project after declaration of commerciality.
Max Torres, Latin America North Exploration Manager for Repsol, said, "We are pleased to have Vinccler Oil and Gas as our future local partner in Venezuela, and we look forward to exploring for natural gas together on the Cardon IV Block."

Bill Gumma, PetroFalcon's President, said, "The Cardon IV Block is strategically located next to our Cardon III offshore acreage with Chevron. Participating in Cardon IV will allow us to access the Robalo structure that drew our interest in the nearby Castilletes NE II Block in 2005.”
“Robalo is one of the largest features identified in the unexplored Gulf of Venezuela. The geologic structure and its associated amplitude anomaly cover 93 sq miles and 46 sq miles, respectively, and together provide a world class exploration target at a relatively shallow drilling depth."

The transaction is subject to the approval of ENI and the Venezuelan Ministry of Energy and Petroleum (MENPET), as well as the negotiation and signature of a binding sale and purchase agreement.
Repsol and ENI were awarded the Cardon IV Block with the high bid of $ 34 mm in the second phase of the Rafael Urdaneta Project in 2005. The Cardon IV Block covers an area of 924 sq km (approximately 228,000 acres) and is located in relatively shallow waters, 30 km west of the Paraguana Refinery Complex, the world's largest refinery.

The acquisition of 700 sq km of 3D seismic data over the Cardon IV Block was completed in February 2007. The data is now being interpreted, and a drilling decision for an exploration well is expected in mid-2008, with a likely spud date in early 2009.
A jack-up rig is being secured with a multi-operator group from adjoining blocks in the Gulf of Venezuela. If successful, first commercial production of natural gas is expected in 2011.