The Canadian Niko Resources Limited made the announcement of obligations under the PSC and JOA this past weekend while declaring terms of acquisition of Chevron International Bangladesh Limited (CIBL), a subsidiary of Chev-ronTexaco Corporation, closed on September 16.

Niko closed the acquisition through its subsidiary Niko Resources (Cayman) Limited.

The CIBL held 60 per cent working interests in the PSC for the prospective block 9 covering approximately 6,880 square kilometres in the central part of Bangladesh, surrounding Dhaka.

In addition, the subsidiary is responsible for the costs associated with a 6.67 per cent carried interest in the PSC held by the state-owned exploration and production company Bapex.

In announcing the acquisition, Niko said it is anticipated that approximately US$17.5 million would be required to fulfill the initial obligations under the PSC and the JOA.

"US$2 million was paid to ChevronTexaco prior to closing and US$10 million put in an escrow account to cover past and immediate future costs of drilling and other activities," it said.

The announcement, made from Calgary, said future drilling and other activities beyond the escrow account would be funded with Niko's internal financial resources. The initial obligations are expected to be complete within the next 8-9 months.

"Niko, through its subsidiary, has agreed to indemnify ChevronTexaco for all claims and losses arising from environmental and other matters on block 9 lands, whether they arose before or after the closing."