3P International Energy Corp. (TSX: DOH) has entered into a binding letter of intent (LOI) with JSC "Nadra Concern" for the purchase of its wholly owned subsidiary JSC "Tysagaz" the title holder to four gas licenses in Ukraine: the Rusko-Komarivske, Stanivske, Korolivske gas fields, and the Uzhogorod exploration block in the Western Ukrainian's TransCarpathian region. If completed, the acquisition will provide immediate cash flow to the Corporation from the Rusko-Komarivske field and an asset base consisting of multiple fields with proven reserves and significant exploitation potential.

The 3P team is excited by the prospects of this transaction given the strong operating base from which Tysagaz is currently operating.

"Acquiring a proven reserve base with upside potential in today's market of approximately USD$8.0 per mcf gas and netbacks north of USD$6.0 per mcf after royalties and operating costs, should immediately provide returns to 3P and position the corporation to become a significant player in the Ukraine," said David Kahn, president and chief executive officer of 3P.

Greg Cameron, chairman of 3P added, "The proposed transaction is a great fit to our announced strategy of acquiring conventional assets with cash flow and significant reserves to compliment or growing unconventional portfolio, which is currently focused on acquiring and farming into lands with coalbed methane (CMB) potential. We are also pleased to be cooperating and expanding our relationship with such a well respected entity like Nadra."

Based on Tysagaz's approved and permitted development plan, five shallow wells will be drilled during 2011 and early 2012. Given existing data and historical stabilized flow rates of the current wells (in excess of 1,000 mcf/d), management is excited about the development potential for all four fields. Furthermore, after a review of the available data and the proposed development plan, 3P believes the potential combined production from all four fields could be in excess of 15,000 mcf/d after full development, and expects a 2011 exit rate of approximately 5,000 mcf/d.

According to the terms of the binding LOI, the potential acquisition remains subject to a 60-day due diligence period, the execution of a definitive agreement, and involves a total cash payment of US$17 million. Completion of the acquisition remains subject to receipt of all necessary regulatory approvals, including that of the Anti Trust Committee of Ukraine.