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Koi Article Archive
St. John's, Newfoundland December 16 2003--Vulcan Minerals Inc. ("the Company" TSX: VUL) announces that it has entered into an agreement with Contact Exploration Inc. of Calgary (Contact) whereby the company will farmin on Contact's two onshore petroleum permits at Parson's Pond, Western Newfoundland. These permits cover approximately 70,000 acres of the prospective eastern margin of the Anticosti Basin which covers the Gulf of St. Lawrence. The Parson's Pond permits contain several seismic targets in an onshore location at modest depths of 900-2600 metres.
The area is renown for surface oil seeps within Cambrian-Ordovician sediments. Shallow historic drilling in the area has encountered a light, sweet oil (43˚ API) in several well bores which were drilled without the aid of subsurface seismic imaging. Recent seismic surveys of the area now clearly image potentially petroleum-trapping structures at depths beyond the historic drilling attempts.
The company will pay 16.67% of the drilling and abandonment or completion costs of a test well on permit 03-103 to earn a 10% working interest in both permit 03-103 and permit 03-101. The test well has a projected depth of 1200 metres. The company's share of drilling costs will amount to approximately $150,000.00. The target consists of an Ordovician structure which based on seismic data has an interpreted closure in excess of 25 square kilometres. A well drilled in 1965 near the structure may have started to tag the target before it was abandoned due to drilling problems. Gas was encountered at the bottom of the hole and belching could be heard 9-12 metres from the hole for a month after drilling. Contact will be the operator of the drill program. The agreement is conditional on the commencement of drilling on the test well by February 15, 2004.
The company's participation in this program will not detract from its Flat Bay program for 2004. This farmin is consistent with the company's focus on the petroleum exploration of Western Newfoundland and provides further exposure to a high impact exploration opportunity.
Flat Bay Onshore Western Newfoundland
The company is presently reviewing drilling proposals for the Flat Bay #2 well expected to commence drilling in early 2004. As well, arrangements for the stimulation and testing of Flat Bay #1 are being finalized for an early 2004 field operation.
Little River Gold Property
The company has amended the option agreement dated May 27, 2003 with Nortec Ventures Inc. (Nortec) wherein Nortec has a right to earn an interest in the Little River Gold property in Central Newfoundland. Nortec has not yet received TSX Venture Exchange approval of the acquisition and therefore the parties have agreed to remove two peripheral mineral licenses from the agreement. Vulcan now owns a 100% interest in the two mineral licenses which are now referred to as the Hermitage property and has paid security deposits to keep the property in good standing. Consideration for the original option agreement remains unchanged. Nortec is continuing with the necessary steps to acquire TSX Venture Exchange approval of the Little River property acquistion.
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