Niko Resources Ltd.

Niko Resources Ltd.

March 27, 2009 09:00 ET

Niko Resources Signs 1st Long Term Gas Contracts for D6

MUMBAI, INDIA--(Marketwire - March 27, 2009) - Niko Resources Ltd. (TSX:NKO) along with their partner Reliance Industries Limited (RIL) has signed the Gas Sales and Purchase Agreements (GSPA) with customers in India's fertilizer sector for supply of natural gas to be produced from the KG-D6 block. The GSPAs were signed with 12 customers in the fertilizer sector for supply of approximately 15 million standard cubic meters daily (530 million standard cubic feet daily) of natural gas at 15 different urea manufacturing facilities.

With the signing of GSPAs, D6 gas would reach all gas-based urea manufacturing units in India, eliminating the deficit in gas supply currently faced by these units. We look forward to having a long-lasting and mutually beneficial relationship with the fertilizer companies.

The key highlights are:

- The duration of contract under the GSPA is 5 years;

- The gas price in GSPA is as per the formula approved by Empowered Group of Ministers, Government of India;

- The supply of gas is expected to commence shortly;

- The fertilizer companies also signed Gas Transportation Agreements.

Secretary - Petroleum & Natural Gas, Secretary - Department of Fertilizers, and other officials of the Government of India were also present during the execution of GSPA in Mumbai today.

March 27, 2009

Certain statements in this press release are forward-looking statements. Specifically, this press release contains forward-looking statements relating to management's approach to operations, estimates of future sales, production and deliveries, business plans for drilling and development, estimated amounts and timing of capital expenditures, anticipated operating costs, royalty rates, cash flows, transportation plans and capacity, anticipated access to infrastructure or other expectations, beliefs, plans, goals, objectives, assumptions and statements about future events or performance. The reader is cautioned that the assumptions used in the preparation of such information, although considered reasonable by Niko at the time of preparation, may prove to be incorrect. Actual results achieved during the forecast period will vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors. Such factors include, but are not limited to: general economic, market and business conditions; industry capacity; competitive action by other companies; fluctuations in oil and gas prices; the results of exploration and development drilling and related activities; the uncertainty of estimates and projections relating to productions, costs and expenses; uncertainties as to the availability and cost of financing; fluctuations in currency exchange rates; the imprecision in reserve estimates; risks associated with oil and gas operations, such as operational risks in exploring for, developing and producing crude oil and natural gas; risks and uncertainties involving geology of oil and gas deposits; the weather in the Company's area of operations; the ability of suppliers to meet commitments; changes in environmental and other regulations; actions by governmental authorities including changes in laws and increases in taxes; decisions or approvals of administrative tribunals; risks in conducting foreign operations (for example, political and fiscal instability or the possibility of civil unrest or military action in countries such as India and Bangladesh); the effect of acts of, or actions against international terrorism; and other factors, many of which are beyond the control of Niko. There is no representation by Niko that the actual results achieved during the forecast period will be the same in whole or in part as those forecast.

Contact Information

  • Niko Resources Ltd.
    Edward S. Sampson
    Chairman of the Board, President & CEO
    (403) 262-1020
    Niko Resources Ltd.
    Murray Hesje
    VP Finance & CFO
    (403) 262-1020