Arc said yesterday that the Yemen Government has ratified Block 7 in the Shabwah Basin and Block 74 in the Masila Basin, a signal that exploration activity is free to begin.

The oil-prospective blocks - in which Oil Search holds a 34.5% stake, Arc has 21.25% and Adelphi has 8.5% - are located in areas with proven petroleum systems, according to Arc.

During the initial three-year work program, the partners will reprocess existing data, acquire new 2D and 3D seismic, and drill at least seven exploration wells.

Other interests in the Yemen blocks are Kufpec, with 21.25% and Yemen General Corporation for Oil & Gas with 15%.