Speaking to the company’s annual general meeting, acting chief executive Scott Spencer said results from Tiof wells drilled so far have indicated a probable reserve of between 300 million and 350 million barrels of oil. This is about twice the size of the nearby Chinguetti field, which is due to come on stream next year and should produce about 75,000 barrels a day.

Spencer said if the Tiof appraisal program went as expected, the partners – which include Woodside petroleum, the UK’s BG and Sterling Resources, ROC Oil and the Mauritanian government – would probably initiate a phased development.

Production would start at about 50,000 barrels a day in 2007, to generate early cash flow and make the most of booming oil prices, and build up to as much as much as 130,000 barrels a day. The total development cost would be about $1 billion, he said.

Spencer said results from the Tevet field looked likely to be a 50 million to 100 million barrel field. Only 10km from Chinguetti, Tevet could probably be tied back to the main field, minimising infrastructure costs

Hardman expected to secure funding for its share of the Chinguetti development within days, according to Spencer. Documentation for up to $US100 million was being finalised with the ANZ Investment Bank of London Bank, he said.

Hardman owns 21.6% of Tiof and 19% of Chinguetti. Woodside holds respective interests 53.8% and 47.4%, while Sydney-based Roc Oil holds 3.7 % and 3.25 % respectively. If the Mauritanian government exercises its agreed entitlement to buy into Tiof, the partners’ Tiof stakes will fall to the level of their current Chinguetti stakes.

Junior partner Roc Oil managing director Dr John Doran told EnergyReview.Net that if Tiof was successful the government would almost certainly buy in.

“I’ve always operated on the assumption that they would buy into any successful blocks,” Doran said.

“Some people thought theywere too poor to be able to buy in, but I believed they were so poor that they could not choose to opt out.”