Sterling was awarded an onshore block OPL 277 as a Production Sharing Contract and the PSC was signed with an effective date from 22nd September 2006.

Sterling is the Operator of the OPL 277 block with 51% participating interest. The balance of the interest is shared with Partners Domon Oil Services Limited at 24%, Kunoch Oil Services Limited at 15% and Prime Time International Energy Services at 10%.

Sterling has proposed to acquire 3D seismic data covering the entire block, introduce a latest technology called geo-spectra IPDS which directly determined the hydrocarbon presence and the height of oil column in the prospective areas, drill 3 to 4 exploration and appraisal wells within 18 months from the effective date of the PSC (22nd September 2006).

If the wells are successful, Sterling plans to set up the production facilities (subject to approval of field development plan by the Nigerian Authorities) and start the commercial production within 24 months from the effective date of the PSC (22nd September 2006).

In addition to the OPL 277 block, Sterling is intending to participate in the new bid round in 2006 in Nigeria and acquire more blocks in nearby African countries as appropriate in 2007.