Hyperdynamics Reaches Agreement With Government of Guinea on Production Sharing Contract Terms

SUGAR LAND, Texas, March 25 /PRNewswire-FirstCall/ -- Hyperdynamics Corporation (NYSE Amex: HDY) today announced that it and the Government of the Republic of Guinea have executed an amendment to the 2006 Production Sharing Contract (PSC).  The document was signed by the Guinean Minister of Mines and Geology, Mahmoud Thiam; the Minister of Finances and Economy, Kerfala Yansane; and Ray Leonard, Hyperdynamics' President and Chief Executive Officer. A decree giving the Government's formal agreement to the assignment of a 23% interest to Dana Petroleum in the PSC is being prepared and will be issued in the near future.

The amendment was entered into in accordance with the September 2009 Memorandum of Understanding (MOU) between Hyperdynamics and the Republic of Guinea that reaffirmed the Company's PSC but which also required a review of the commercial terms to ensure that they were in line with international standards.

In addition to addressing the points raised in the MOU and clarifying certain elements of the PSC, the amendment included the following terms:

• The company will retain a contract area of approximately 24,000 sq km, 30% of the original concession area and will relinquish 25% of the retained contract area by September 30, 2013.
• In September 2010, the company will enter into the second exploration period which runs until September 2013 and may be extended to September 2016.  The work program to September 2013 is to acquire a minimum of 2000 sq km 3D seismic and drill an exploration well, to be spudded by end 2011, to a minimum depth of 2500m while that for the period from September 2013 to September 2016 is to drill one exploration well to a minimum depth of 2500m.
• The Republic of Guinea will be carried through to first production for its share of up to 15%, at which time the cost of that carry will be recovered out of 62.5% of the Republic of Guinea's share of cost and profit oil.     
• An annual training budget of $200,000 will be established for the benefit of Guinea oil industry personnel, and the companies will also pay an annual surface tax of $2.00 per square kilometer on its retained acreage.  

"This agreement formally reconfirms that the PSC among the Republic of Guinea, Hyperdynamics and Dana Petroleum is in full force and effect.  The extra step of presentation, debate and approval of the amended PSC by the Council of Ministers prior to signing is further evidence of the open and transparent government being established in the Guinean transition to democracy. We believe that the terms of the PSC are both fair and equitable and aligned with international standards," Leonard said. 

"Detailed analysis of the recently completed 10,000 km 2D seismic program has allowed us to further focus on the most prospective areas. We believe that successful exploration and production will be a substantial contributor to the Guinean economy, while also creating a good return for our shareholders. We expect to begin work on a 3D seismic survey in the third quarter 2010 to identify potential well locations for initial drilling late next year," Leonard concluded.

About Hyperdynamics

Hyperdynamics is an emerging independent oil and gas exploration and production company that is exploring for oil and gas offshore the Republic of Guinea in West Africa.  To find out more, visit our website at www.hyperdynamics.com.

Forward Looking Statements

This news release and the Company's website referenced in this news release contain forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding Hyperdynamics Corporation's future plans and expected performance that are based on assumptions the Company believes to be reasonable. Statements preceded by, followed by or that otherwise include the words "believes", "expects", "anticipates", "intends", "projects", "estimates", "plans", "may increase", "may result", "will result", "may fluctuate" and similar expressions or future or conditional verbs such as "will", "should", "would", "may" and "could" are generally forward-looking in nature and not historical facts. A number of risks and uncertainties could cause actual results to differ materially from these statements, including without limitation, funding and exploration efforts, fluctuations in oil and gas prices and other risk factors described from time to time in the Company's reports filed with the SEC, including the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2009. The Company undertakes no obligation to publicly update these forward looking statements to reflect events or circumstances that occur after the issuance of this news release or to reflect any change in the Company's expectations with respect to these forward looking statements.

HDY-IR

SOURCE Hyperdynamics Corporation

WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?

440k+
Newsrooms &
Influencers

9k+
Digital Media
Outlets

270k+
Journalists
Opted In

GET STARTED