Cabot Energy Regulatory News (CAB)

13 Nov 2006 13:36

For immediate release: 13 November 2006 Northern Petroleum Plc ("Northern" or the "Company") Drilling Report Northern announces that the Steenwijk-1 exploration well onshore Netherlands drilled in partnership with the joint Shell and ExxonMobil subsidiary Nederlandse Aardolie Maatschappij B.V., ("NAM") has not encountered significant hydrocarbons in the Rotliegendes sandstone, the primary objective. The well was deepened into the Carboniferous but did not encounter hydrocarbon bearing intervals from the objective depth to a total depth which was determined by operational constraints, therefore the decision has been made to plug and abandon the well. The Company is able to report that the well was drilled in 20 days, operationally considerably ahead of schedule and at an expected cost significantly under that budgeted. Steenwijk-1 was the first of four exploration wells to be drilled in partnership with NAM, a partnership which also includes the development into production of five oil and gas discoveries. Under the terms of its agreements with NAM, Northern is entitled to recover the dry hole cost of the Steenwijk-1 well out of the pre-tax revenues from future discoveries before sharing the profits with NAM on an equal basis. Derek Musgrove, Managing Director of Northern, stated: "The drilling of the Steenwijk wildcat exploration well was always viewed as part of the "consideration" for the wider deal with NAM to acquire five onshore Netherlands oil and gas fields. We will now move on from this result to drill the first of these five fields scheduled for development to production for which our plans are at an advanced state and a rig contract is due for signature shortly. There are no implications resulting from Steenwijk-1 which impact on the field developments save the potential benefits of cost saving experiences." In accordance with the AIM Rules - Guidance for Mining and Oil & Gas Companies, the information contained in this announcement has been reviewed and signed off by the Exploration Manager of Northern, Mr Graham Heard BSc (Hons), who has over 30 years experience as a petroleum geologist. -Ends- Contacts: Northern Petroleum Plc Derek Musgrove, Managing Director Chris Foss, Finance Director Graham Heard, Exploration Manager Tel: +44(0)20 7743 6080 Hansard Communications Chris Roberts / Ben Simons Tel. +44(0)20 7245 1100 Notes to Editors: Northern Petroleum is a junior oil and gas exploration and production company, focussed on the EU, with major assets in the Netherlands, Italy and the UK. Further information on Northern is available at www.northpet.com