By Emmy Olaki and Agencies

HERITAGE Oil Corporation, has temporarily suspended a share buyback programme pending the results of drilling at the Turaco 2 oil well in Semliki, Western Uganda.

According to a Monday statement from Micael Gulbenkian chairman and chief executive of the Calgary (in Canada) based oil and gas firm, the Turaco 2 (the second oil well) drilling program is proceeding satisfactorily and itâ€™s results are expected to have a material impact on the company.

â€œThe board therefore felt it would be appropriate to suspend the issuer bid program (share buy back) until the well results are made public,â€ he said.

In a share buyback programme such as this, a company makes shareholders an offer to buy back some of its own shares.

Listed companies tend to institute buyback share schemes when they want to distribute to share holders money that the company doesnâ€™t need.

Companies also do this to reduce administrative costs in a listed company by buying out holders of small parcels of shares.

The Heritage Oil share buy back was announced in November 2003.

Heritage Oil won the license to explore and drill for oil in block 2 at the Semliki in western Uganda.

Last year, the company made an attempt to drill for oil, which came to a standstill when the drill string got stuck in the well. About two months ago, the company brought in a new rig , which is currently being used to drill at Turacco 2.

Results from the almost 3,000 metre well are expected to be ready early this year. Already, the drilling exercise has covered about 2200 meters.

As a global player Heritage Oil has principle properties in the republic of Congo, Oman and Uganda.

At the time of filing the statement, heritage oil shares at the Toronto Stock exchange were unchanged at $2.90 per share.