Transeuro Energy Corp.

Transeuro Energy Corp.

October 01, 2009 10:38 ET

Transeuro Energy Corp.: Ukraine Gas Sales Agreement

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 1, 2009) - Transeuro Energy Corp. ("Transeuro" or the "Company") (TSX VENTURE:TSU)(OSLO:TSU) announces that it has signed an agreement to sell gas from its 2 wells on the Krasnapolianskoye field in Ukraine with first production in 4 months.

The Krasnapolianskoye field is located in the Northwest of Crimea around 6km south of the Karlavskoye field near the village of Chornomorske. The field was first drilled in 1963 with gas discovered in the Paleocene carbonate reservoir at a depth of 1050m and then the field was appraised with 10 wells, although never put onto production. The Ukraine government estimates reserves of 14 Bcf while Transeuro third party auditors have assigned possible reserves of 2.7 Bcf. The Company re-entered 2 wells in 2004 that tested at 33,000 and 22,000 m3/day and commenced construction of a gas treatment plant that was then suspended due to the low gas price available in the country at that time.

The Company has now entered into a Gas Sales Agreement through its local subsidiary to sell all gas produced from the 2 wells to a local Ukraine Company "AutoGasComplect". The Buyer intends to process the gas into Compressed Natural Gas (CNG) to sell for use in vehicles within Crimea, and is responsible for the cost and installation of all surface equipment and to commence production within 4 months. The point of sale is at the wellhead and Transeuro is not required to contribute any funds to the project. The contract volume of gas to be sold is not defined, but assuming a likely average rate of 35,000 m3 per day the annual net profit to the local subsidiary after taxes and royalties is forecast around US$1 million.

David Worrall, President and CEO of Transeuro, commented, "This is an exciting time to commencing gas production in Ukraine and to prove our ability to deliver tangible results. We are grateful for the assistance provided by our state partners 'Nak Nadra' and 'Crymgeologia' for their support and co-operation in concluding this agreement and in particular to Mr. Vasily Boyko and Mr. Vladimir Daryichuk. Together with the recent announcements concluding the RAG settlement and the extension of the Karlavskoye license our Ukraine strategy is now back on track."

Transeuro Energy Corp. is involved in the acquisition of petroleum and natural gas rights, the exploration for, and development and production of crude oil, condensate and natural gas. The Company's properties are located in Canada, Armenia, and Ukraine. In addition, the Company owns shares in Eaglewood Energy Inc. and holds a back-in option to their exploration licenses in Papua New Guinea.

On behalf of the Board of Directors

Aage Thoen, Chairman

The statements contained in this release that are not historical facts are forward-looking statements, which involve risks and uncertainties that could cause actual results to differ materially from the targeted results. The Company relies upon litigation protection for forward-looking statements.

The TSX Venture Exchange and Oslo Bors have not reviewed, and do not accept responsibility for the adequacy or accuracy of the content of this news release.

Contact Information

  • Transeuro Energy Corp.
    David Parry
    +1 604 6813939
    Transeuro Energy Corp.
    Karen Jenssen
    +47 91 729787