Sea Dragon Energy Inc.
TSX VENTURE : SDX

Sea Dragon Energy Inc.

August 19, 2009 09:00 ET

Sea Dragon Announces Acquiring an Interest in North West Gemsa Development and Exploration Lease in Egypt

CALGARY, ALBERTA--(Marketwire - Aug. 19, 2009) -

NOT FOR DISTRIBUTION TO U.S NEWSWIRE OR FOR DISSEMINATION IN THE UNITED STATES

Sea Dragon Energy Inc. ("Sea Dragon" or the "Company") (TSX VENTURE:SDX) has signed a sale and purchase agreement with Premier Oil Overseas BV to acquire Premier Egypt (N W Gemsa) B.V. which holds their interest in the North West Gemsa Concession. Premier Oil Overseas BV is a subsidiary of Premier oil Plc.

The acquisition, subject to the necessary approvals from the Egyptian government, will give Sea Dragon a 10% working interest in this Concession including an area around the recent discoveries which has been converted to a development lease. The cost of this acquisition is US$12.5 million.

North West Gemsa is currently a 250 square km. onshore concession area located approximately 300 km south east of Cairo. The current partners are Vegas Oil and Gas (the current operator), holding a 50% interest and Circle Oil Plc with 40% interest.

In October 2008 a discovery was announced on Al Amir-SE1 well with 41 degrees API oil tested at 3,388 bopd and 4.25 MMscfd gas. In February 2009 a 20 year development lease was agreed by the Egyptian Government and further drilling continues to develop these discoveries and prospects within the greater concession area. In May 2009, a further discovery was announced on Geyad-1X where two zones tested 40 degrees API oil. The first zone tested 2,809 bopd with 3.04 MMscfd gas and second, upper zone tested 1,174 bopd with 1.324 MMscfd gas.

The Company is concluding an independent reserve study of current internal estimates which are around 15 million barrels of recoverable oil in place, netting 1.5 million barrels to Sea Dragon.

Production of 2,250 bopd has commenced and as further facilities are installed is expected to increase to between 6,000 to 7,000 bopd, including the potential for commercialisation of the gas.

Said Arrata, President, CEO and Executive Chairman, said "We are delighted to announce this first acquisition under our strategy to develop a portfolio of production, development and exploration assets, for Sea Dragon Energy, Inc. We look forward to continuing the strategy and announcing further acquisitions in the near future".

For further information please see the website of the Company at www.seadragon.ca or the Company's filed documents at www.sedar.com.

Statements in this release that are forward-looking statements are subject to various risks and uncertainties concerning the specific factors disclosed under the heading Risk Factors and elsewhere in the Company's filings with Canadian securities regulators. Specifically that there is no assurance that any hydrocarbon reserves will be discovered nor is there any assurance that any hydrocarbons encountered will be in commercially recoverable quantities. Such information contained herein represents management's best judgment as of the date hereof based on information currently available. The Company does not assume any obligation to update any forward-looking statements, save and expect as may be required by applicable securities laws.

Sea Dragon is an international exploration and development company with a focus on the Middle East and an office in Cairo Egypt.

The TSX.V Venture Exchange has neither approved nor disapproved of the information contained herein.

The TSX.V Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Sea Dragon Energy Inc.
    Said Arrata
    President, CEO and Director
    (403) 457-5035
    or
    Sea Dragon Energy Inc.
    David Thompson
    Senior Vice President and Director
    (403) 457-5035
    or
    Brisco Capital Partners
    Scott Koyich
    President
    (403) 262-9888
    skoyich@briscocapital.com
    or
    Brisco Capital Partners
    Graeme Dick
    (403) 561-8989
    graeme@briscocapital.com