Infinity to explore Caribbean off Nicaragua

May 15, 2006
Infinity Energy Resources Inc., Denver, will seek partners and possibly other ownership structures to explore 1.4 million acres on 24 blocks in the Caribbean Sea off Nicaragua.

By OGJ editors
HOUSTON, May 15 -- Infinity Energy Resources Inc., Denver, will seek partners and possibly other ownership structures to explore 1.4 million acres on 24 blocks in the Caribbean Sea off Nicaragua.

The company and the government executed contracts this month that cover the Tyra and Perlas prospects. The exploration period lasts up to 6 years, and the first year's required $1 million expenditure is included in Infinity's budget.

Exploration would focus on Cretaceous carbonate and Eocene reservoirs. The company sees analogies with fractured Cretaceous carbonates in Mexico, Venezuela, and Guatemala and believes that Cretaceous source rocks onshore Honduras and Nicaragua can be projected offshore onto the Caribbean shelf.

Managers and consultants believe five large structures on the acreage could hold substantial oil and gas reservoirs.

Key fiscal terms include government royalty of 5% rising to 15% assuming large-scale production, graduated income tax rates to 30%, and 100% initial working interest for Infinity.