Heritage awarded contract in Iraq

Heritage Oil Corporation has executed a Production Sharing Contract with the Kurdistan Regional Government (KRG) over Miran Block in the south-west of the Kurdistan Region of Iraq and that Heritage will be operating as a 50/50 partner with the KRG to create a 20,000 barrel per day oil refinery in the vicinity of the licence area.

Under the terms of the agreement, Heritage Energy Middle East Limited, a wholly owned subsidiary of Heritage, will serve as operator. Heritage will join the existing and increasing presence of international oil exploration, development and production companies operating in the Kurdistan Region of Iraq.

The license area is 1,015 square kilometers and encompasses the very large Miran structure. This structure, as expressed at surface, constitutes an area of approximately 500 square kilometers and appears to have three separate culminations. Reservoir potential exists at numerous zones that management estimate could contain in excess of 1 billion barrels of oil. Recent drilling results have demonstrated the enormous potential of this region.

In addition, Heritage has also entered into a strategic agreement with the KRG to establish a 50/50 joint venture company, which shall build, own and operate an oil refinery in the vicinity of the license. The refinery, which should have a capacity of 20,000 barrels of oil per day, is scheduled to be operational to design specification within approximately two years. Heritage is especially pleased to be part of this extremely exciting and profitable project that will create value added petroleum products for the region and all of Iraq.