Jura Energy Corporation (TSX:JEC) ("Jura" or the "Company") is pleased to announce the first gas production from the Reti-Maru gas fields in the Guddu Block commenced on Thursday, December 26, 2013. Initial production is being controlled to allow buyer and seller facilities testing, commissioning and pipeline packing. Once fully brought on-stream after the commissioning period, management of Jura expects gross production to reach 12 MMcfd (net to Jura 1.3 MMcfd) in January 2014.
The gas is being sold to Engro Fertilizers Limited as the representative of a consortium of fertilizer companies pursuant to a gas sale agreement (the "GSA") entered into by Jura in March 2013. Engro is a leading Pakistani fertilizer company.
Pursuant to amendments made in the Pakistan Petroleum Exploration & Production Policy, 2012 after the execution of the GSA, Reti-Maru gas discoveries qualify for gas pricing under Pakistan Petroleum Exploration & Production Policy 2009 (the "2009 Policy"). The expected gas price under the 2009 Policy conversion regime will be US$ 3.40 per MMBtu. The final determination of gas price is pending approval before the Government of Pakistan. Based on the gas price of US$ 3.40 per MMBtu the expected monthly revenue net to Jura will be US$ 80,000.
The Guddu block covers an area of 2,093 km2 and is located in the district of Ghotki, straddled between the Sindh and Punjab Provinces in Pakistan. Jura holds 10.66% working interest in the Guddu block, which is operated by Oil and Gas Development Company Limited.
Shahid Hameed, President and Interim Chief Executive Officer of Jura stated, "The start of sales from Guddu is a significant milestone for us since it brings a second Jura property into revenue generation. We will look forward to utilizing the cash flows to accelerate value realization for shareholders."
