By OGJ editors
HOUSTON, Nov. 3 -- Petro-Canada has signed an agreement with a Marathon Oil Corp. subsidiary to buy a 90% interest in Marathon's 25-year production-sharing contract covering Ash Shaer and Cherrife gas fields in central Syria for $54 million (Can.).
The agreement allows Petro-Canada to become operator as well as offers it the option to also buy the remaining 10% interest in the PSC from Marathon within 5 years. The 10% interest transfer option has not yet been approved by the Syrian government.
Under terms of the PSC, Petro-Canada is obligated to develop and produce an estimated 80 MMcfd of gas from Ash Shaer and Cherrife fields. Production is expected to begin in 2010.
Appraisal work is expected to identify upside in the fields, which could double the initial life-of-field production, currently estimated at 500 bcf of gas equivalent over the contract period. This could lead to an expansion of production capacity after initial start-up.
Capital investment for the project is expected to be $550-800 million (Can.), depending on the life-of-field production.
