Pan Asia Mining Corp., Vancouver, BC, said Monday it would purchase for $3 million a 51% interest in EuroGas GmbH (EuroGas-Austria) of Vienna, a subsidiary of London-based EuroGas Inc. of London. All of the funds will be spent on future exploration in Russia's Autonomous Republic of Sakha.
EuroGas-Austria owns a 50% interest in the TAKT Joint Venture, which is developing proven oil and gas reserves and exploring for new oil and gas deposits on two large concession blocks located near the city of Lensk. The two blocks encompass 21,300 sq km.
TAKT also owns the right of first refusal over any future oil and gas exploration and development in the Republic of Sakha, as well as exploration, production, and development rights to all other mineral resources and timber located on all present and future TAKT acreage in the Sakha Republic, excluding diamonds.
EuroGas-Austria acquired this asset from OMV AG, Austria�s national oil and gas company, in 1997. Sakhaneftegaz, the national oil and gas company of Sakha, holds most of the remaining interest.
The purchase price will be paid in allotments of no less than $250,000 over 4 years, said Pan Asia. The company has arranged financing for the purchase of the 51% interest with a private London-based company.
OMV has spent several years working on the TAKT Joint Venture and retains a 5% net profit interest in the joint venture. OMV has agreed to provide technical assistance and advice in the development of TAKT�s oil and gas resources.
Prior to selling its 50% stake in TAKT to EuroGas Austria, OMV performed exploration and development work on these two blocks. It postulated that the blocks could contain reserves of up to 9-18 tcf of natural gas and up to 370 million bbl of recoverable oil and condensate, said Pan Asia.