Tullow Oil and its partner Hardman Resources have signed an agreement with the government of Uganda in relation to their ongoing oil exploration activities.
The companies announced to the Irish Stock Exchange today that they have signed a memorandum of understanding on future investment plans for the 'block 2' oilfield.
The agreement includes commitments by both the joint venture partners and the government to advance the appraisal and development of the block 2 discoveries. It also provides for further exploration of the remainder of the block.
The next well in the firms' 2006 exploration programme is Nzizi-1 to the south west of the Mputa discovery.
Further seismic surveys will also be carried out to help better define the volumes of the existing discoveries and to identify prospects for drilling in 2007 and 2008, a statement from the venture partners said.
Simon Potter, CEO and managing director of Hardman Resources said the partners appreciated the Ugandan government's "strong support" for their operations since the oil discoveries at Waraga and Mputa.
"Confidence in the existing resource base and the market potential allows us to consider an early production scheme. Further success in the planned exploration programme could lead to significant expansion of domestic plans or an export option," he said.