Arawak completes acquisition of 40% stake in the Saigak field in Kazakhstan



    TSX TRADING SYMBOL: ABG

    JERSEY, Channel Islands, June 10 /CNW/ - Arawak Energy Limited ("Arawak"
or the "Company") is pleased to announce that it has completed the acquisition
of Saigak Investments BV, a company that has a 40% participating interest in
the Saigak field in Western Kazakhstan, from Vitol BV. This transaction was
originally announced in June 2007, following the signature of an initial
agreement, which was subject to certain conditions, including obtaining
necessary statutory and governmental approvals. The process of obtaining the
required consents was finally completed at the end of May 2008, allowing the
Company to complete the transaction. In consideration for the transaction,
Arawak issued 8,352,587 common shares to Vitol BV on 9 June 2008. The Vitol
Group of companies ("Vitol"), a leading independent oil trading and marketing
group, is Arawak's largest shareholder and as a result of this transaction has
increased its stake to 41.52%.
    The Saigak field is located approximately 120 km from the Company's
existing Akzhar field in the Aktubynsk region of Western Kazakhstan and is
operated by Maersk Oil Kazakhstan GmbH ("Maersk"), which owns the remaining
60% interest. The Saigak field is currently producing around 2,000 bopd gross
from four wells, one of which is currently being worked over. According to a
report prepared by the Company's independent reserve evaluators, McDaniel &
Associates Consultants Ltd., remaining proved plus probable reserves
attributable to Arawak's 40% interest as of 31 December, 2007 are estimated at
2.2 million bbls. The Company has also obtained the cashflow from the
effective date, 1 January 2007, to closing, totalling US$12.4 million.
    Saigak, a sweet 33-37 degrees API crude, is currently produced from four
wells and from multiple zones at around 2,000 metres depth. All crude is
currently exported.
    Saigak is produced under a production sharing contract ("PSC"), which was
originally signed in 1992 and is valid until 2022. The terms of the PSC are
unique, including a 12.5% royalty and 100% export rights. All other taxes and
duties are included in the government profit share, currently calculated at
24%.
    Alastair McBain, President & Chief Executive Officer of Arawak commented:
"Today's completion of the Saigak acquisition increases our productive
capacity in Kazakhstan alone to over 10,000 bopd, with current actual
production of around 8,500 bopd. We are now keen to focus on working with
Maersk to look for operational synergies with our existing assets in
Kazakhstan and to seek opportunities to reverse the decline of this relatively
mature but highly cash-generative asset."

    Arawak's common shares are listed for trading on the TSX under the symbol
"ABG". The Company is engaged in the exploration, development and production
of oil and natural gas in Kazakhstan, Russia and Azerbaijan. The Company's
four producing fields and two exploration blocks in Kazakhstan are held
through its 100% wholly-owned subsidiary Altius Energy Corporation ("Altius").
Altius' main producing field is Akzhar, extended in 2006 from 3.8 to 71.5
square km, with smaller fields at Besbolek, Karataikyz and Alimbai. The two
exploration blocks, East Zharkamys III and Tamdykol, are also situated in
western Kazakhstan. Arawak's assets in Russia are held through ZAO
PechoraNefteGas ("PNG") and LLC NK Recher-Komi ("Recher-Komi") in which Arawak
has a 50% interest with the remaining interest being held by Lundin Petroleum
AB. Also in Russia, Arawak holds a 100% interest in the Kymbozhyuskaya
exploration block and in the South Sotchemyu appraisal block. In the
Azerbaijan Republic, the Company's asset is its interest in the South West
Gobustan Exploration Development and Production Sharing Agreement (the
"EDPSA"). Commonwealth Gobustan Limited ("CGL"), in which Arawak has a 37.17%
interest, holds an 80% interest in the EDPSA with the remaining 20% owned by
SOCAR Oil Affiliate.

    This press release includes "forward-looking statements", which are based
on the opinions and estimates of management at the date the statements are
made, and are subject to a variety of risks, uncertainties and other factors
that could cause actual events or results to differ materially from those
projected in the forward-looking statements. These risks and uncertainties
include, but are not limited to, risks associated with the oil and gas
industry (including operational risks in development, exploration and
production; delays or changes in plans with respect to exploration or
development projects or capital expenditures; the uncertainty of reserve
estimates; the uncertainty of estimates and projections in relation to
production, costs and expenses and health, safety and environmental risks),
the risk of commodity price and foreign exchange rate fluctuations, the
uncertainty associated with commercial negotiations and negotiating with
foreign governments and risks associated with international activity. Although
Arawak believes that its expectations represented by these forward-looking
statements are reasonable, there can be no assurance that such expectations
will prove to be correct. Additionally, the estimates of reserves and future
net revenue for individual properties may not reflect the same confidence
level as estimates of reserves and future net revenue for all properties, due
to the effects of aggregation. A barrel of oil equivalent (boe), derived by
converting gas to oil in the ratio of six thousand cubic feet of gas to one
barrel of oil, may be misleading, particularly if used in isolation. A boe
conversion is based on an energy equivalency conversion method primarily
applicable at the burner tip and does not represent a value equivalency at the
wellhead. Due to the risks, uncertainties and assumptions inherent in
forward-looking statements, prospective investors in the Company's securities
should not place undue reliance on these forward-looking statements. For a
detailed description of the risks and uncertainties facing Arawak, readers
should refer to Arawak's Annual Information Form as filed at www.sedar.com.





For further information:

For further information: Arawak Energy Limited, Alastair D. McBain,
President & Chief Executive Officer, Phone: +44 (0)20 7973 4285, Fax: +44 (0)
20 7824 8466; Charles R. A. Carter, Chief Financial Officer, Phone: +44 (0)20
7973 4285, Fax: +44 (0) 20 7824 8466, E-mail: info@arawakenergy.com,
www.arawakenergy.com; Brunswick Group LLP, Patrick Handley, Phone: +44 (0) 20
7404 5959

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Arawak Energy Limited

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