29 Jun 2011 11:36
For immediate release: 29 June 2011
Northern Petroleum Plc ("Northern", "the Group" or "the Company") AGM Statement
Northern Petroleum Plc (AIM:NOP), the independent oil and gas exploration, development and production company announces that at the Annual General Meeting ("AGM") held today, the Chairman of the meeting, Richard Latham will make the following statement:
"Your Company holds, after recently announced adjustments, a little over 89 million barrels of oil equivalence of proven and probable reserves, and has forecasted a production range of 1,550 to 1,650 barrels of oil equivalence per day ("boepd") for 2011. This would still be the best year for production yet, being significantly in excess of the 1,195 boepd produced in 2010.
"Activity over the next twelve months will be largely focused on progressing and de-risking two asset types; those included within this substantial reserve base and those that offer the Group's highest potential exploration. Long term tests on the Markwells Wood and Ottoland oil discoveries will commence this summer. The Papekop-2 and Geesbrug-2 wells are being planned for drilling in late 2011 / early 2012. Gas from Geesbrug-2 can be put on-stream immediately from existing facilities.
"The first stage of the determination of possible interventions to resolve the issues seen at Wijk en Aalburg has been completed. The down-hole gauges placed in the well on 25 May 2011 were removed on 24 June 2011, during which time pressure build up was recorded at the well-head. While the results from the gauges are analysed, the well has been placed back on production, but a prudent decision has been taken to limit production until the results have been fully evaluated.
"One 2D and two 3D seismic surveys are planned in the second half of 2011 on our Southern Adriatic permits, alongside our new 15% partner Azimuth, which will allow not only for the progression of the Rovesti and Giove oil discoveries, which combined hold 53.2 million barrels of probable reserves, but also enable the de-risking of the significant exploration potential within our two awarded permits.
"The Southern Adriatic is just the largest example of the offshore Italian projects that have upside potential that is of a significantly different order of magnitude to our assets in The Netherlands and the UK. Shareholders should therefore expect us to focus much of our human resources towards progressing the Southern Adriatic, the West of Sicily Thrust and Fold Belt where we are partnered with Shell, and the Sicily Channel and Ionian Sea areas. The objective is to enter into agreements to bring new partners with deeper pockets than Northern into these areas.
"The drilling of the 300-700 million barrel Zaedyus prospect offshore Guyane, with Tullow, Shell and Total as partners, is ongoing. The well is now currently expected by the operator to finish drilling in early August 2011. If successful, this well could open up a new petroleum province where currently at least six similar structures have been mapped.
"I am pleased to be able to provide shareholders with a further update on oil shale potential in The Netherlands by way of the following quote extracted from the NuTech Energy Alliance report following the analysis of eight wells in the Northern operated licences in the West Netherlands Basin:
"In further analysing the shale, the histograms comparing the various aspects of the shale with the Eagle Ford and the Niobrara - two of the best shales in the US - are so favourable that we consider this to be an even better quality of shale for production purposes. The hydrocarbon potential certainly looks to be mostly oil, and with very high porosity and permeability in the shale by comparison to the US plays."
Further work is being undertaken to quantify the oil resource potential of this shale which is present in all the Northern licences in the West Netherlands Basin; Andel III, Engelen, Waalwijk and Utrecht.
"Your Company is well positioned to withstand unforeseen events. The balance sheet remains strong, with the Group's year end net cash of €21.4 million having risen to €24.5 million as of 27 June 2011. Northern has no external debt, but has the production and reserve base to in due course obtain debt on appropriate terms. The Company will, as it has always done, continue to expend shareholders' funds in a prudent manner."
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 and Technical Director of Northern, Mr. Graham Heard CGeol. FGS, who has over 35 years experience as a petroleum geologist.
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For further information please contact:
Northern Petroleum Plc Tel: +44 (0) 20 7469 2900 Derek Musgrove, Managing Director Chris Foss, Director of Finance, Legal & Corporate Affairs Graham Heard, Exploration & Technical Director Cenkos Securities (NOMAD and Joint Broker) Tel: +44 (0) 20 7397 8900 Jon Fitzpatrick Jefferies International (Joint Broker) Tel: +44 (0) 20 7029 8000
Chris Snoxall Financial Dynamics Tel: +44 (0) 20 7831 3113
Billy Clegg / Edward Westropp Bishopsgate Communications Tel: +44 (0) 20 7562 3350 Nick Rome / Michael Kinirons
About Northern
Comprehensive information on Northern and its oil and gas operations, including all press releases, annual reports and interim reports are available from Northern's website at www.northpet.com.
XLON