Location:	Central, Southern Armenia
Minteral:	Oil, Natural Gas
Property Size:	13,755 sq km
Stage of Development:	Exploration
Current Work Program:	Geological, Gravity and Geochemical Studies, Remote Sensing, 2-D Seismic
Ownership:	50% Vangold, 50% Blackstairs Energy PLC

Overview: In April 2007 Vangold, partnered with Blackstairs Energy, signed an exploration and production sharing agreement with the government of Armenia that covers roughly half of the entire southern portion of the country. Vangold has shown its commitment to operations in Armenia through exploration initiatives and the opening of a head office in the capital, Yerevan.

The sedimentary basins of Armenia to this day remain relatively under-explored, and the geological history is complex--caused, in part, by the major Caucasus mountain-building structural events. The two main sedimentary basins that are recognized are comprised of groups of smaller complex sub-basins and include the "South-Western Basins" extending west to Armenia's border with Turkey and the "Central Depression" which covers the central part of the country and extends east to the border with oil-rich Azerbaijan and south towards the border with Iran. The structural style identified within these basins displays excellent potential for the development of multiple hydrocarbon traps with widespread evidence of folding, faulting and complex fault thrusts.

Armenia currently imports all of its hydrocarbons, leaving a ready open market for any indigenous sources. Skyrocketing prices have increased the government's desire to locate native hydrocarbons and allowed Vangold to negotiate particularly attractive commercial terms for the exploration and production Sharing Contract. These terms will ensure that even quite small accumulations of either oil or gas will be feasible for commercial development.

	Armenian Oil and Gas Potential Click to Enlarge
	Armenia's License Blocks and structural units Click to Enlarge

Geology: The Central Depression covers most of the joint-venture's License Area and contains a broad age range of sediments from the oldest Devonian era sequences right up to thick recent sediments. This broad sequence offers the potential for the development of various reservoir, source, and seal combinations. In the extreme south in Block 6, adjacent to the Iranian border, a Jurassic-Cretaceous sub basin is virtually unexplored and may offer significant hydrocarbon potential.

History: Previous hydrocarbon exploration has been patchy, unsystematic and undertaken using fairly basic geological and geophysical techniques. From 1947 up to 1990 the former Soviet authorities undertook fairly sporadic programs of seismic exploration and drilling, often lacking in geological and seismic control. Two key well results emerged from this phase of exploration. The Shorakhpur-1P well east of the capital Yerevan encountered minor oil, while further west at Armvir the Oktemberyan-13E well flowed gas at low rates for 6 months. Numerous other boreholes encountered indications of both oil and gas and there were also several other well documented seeps throughout the license area. In the 1990's following initial exploration by the Soviets, seismic and drilling campaigns were completed by AAEC. Their well, Azat1, drilled to a depth of 3524 meters again encountered minor oil shows before being terminated for operational reasons. In 2007 Transeuro Energy Corp. drilled the Kamir-1 exploration well and reported an extensive reservoir interval with well logs indicating a thick zone of low gas saturations. Transeuro also reports that this well has now been suspended with a view to additional logging and testing programs later in 2008.

Current and Future Work Programs: The joint ventures work program over the initial 5 years will consist of geological, gravity and geochemical studies, remote Sensing (Satellite Imagery) and 170 km of 2D seismic. The financial commitment will be $2.4 Million USD over the initial 5 year term.

Cross-section A - A' (Banks et al., 1997) Click to Enlarge Cross-section B - B' (Banks et al., 1997) Click to Enlarge Cross-section C - C' (Banks et al., 1997) Click to Enlarge Cross-section D - D' (Banks et al., 1997) Click to Enlarge	Major stratigraphic units of Armenia (from Jrbashyan et al., 2001) Click to Enlarge
	Trap style example of a Georgian oil field (from Robinson et al., 1997) Click to Enlarge Example of a seismic line from Central trough Click to Enlarge

News Releases

July 17, 2008	Vangold Provides Armenia Oil Project Update
February 28, 2008	Vangold Reports on Oil and Gas Interests in Kenya, Rwanda and Armenia
January 14, 2008	Vangold Acquires 50% Interest in Additional Petroleum Property in Armenia