25 Mar 2011 11:00
Embargoed for release: 1100 on 25 March 2011
Northern Petroleum Plc ("Northern" or the "Company") Northern brings in new partner for Southern Adriatic Permits
Northern announces that it has signed an agreement involving Italian permits F.R39.NP and F.R40.NP which contain the Rovesti and Giove oil discoveries and ten mapped prospects. The objective of the agreement is to work with Azimuth Limited ("Azimuth") a specialist global E&P business, to define and delineate suitable appraisal and exploration drilling targets. Azimuth will become a 15% interest partner in both permits by funding a promoted share of future work programmes prior to the drilling phase.
The future assignment of permit interests to Azimuth, and implementation of aspects of the agreement, are subject to receiving approvals from the Italian authorities.
The Giove and Rovesti oil fields have been independently assessed by Blackwatch Petroleum Services ("Blackwatch") to have 53.2 million barrels of probable oil reserves. In addition, as a result of work undertaken, Northern recognises the potential both for oil prospects with a mean of over 3 billion barrels of oil in place and gas prospects with a mean of over 2 Tcf of gas in place, which is over 1 billion barrels oil equivalent of prospective resource in the two permits, split approximately equally between oil and gas prospects.
Matt Haartsen, commenting on behalf of Azimuth, said:
"Azimuth is excited by the opportunity to work with Northern Petroleum and looks forward to unlocking commercial reserves across the permits".
Derek Musgrove, Managing Director of Northern Petroleum Plc, commented:
"This deal brings additional resources and skills to assist Northern to progress the future development of reserves and drilling of exploration prospects in the permits in one of our key areas in the Italian offshore.
"The Rovesti field was discovered in 1978 by Eni and the nearby Giove field was discovered in 1998 by Enterprise Oil Plc. Blackwatch have assigned P2 oil reserves of 33.6 million barrels to Rovesti and 19.6 million barrels to Giove and support the view that there is high potential within the two permits. We have surmised that the decisions by previous companies not to move these two discoveries towards development could be attributed to the depth of water of Rovesti in the context of the then prevailing oil industry capabilities and costs, and that Giove was found to be smaller than originally mapped and at the time low oil prices prevailed."
- Ends -
For further information please contact:
Northern Petroleum Plc Tel: +44 (0) 20 7469 2900 Graham Heard, Exploration & Technical Director Cenkos Securities (NOMAD and Joint Broker) Tel: +44 (0) 131 220 6939 Ken Fleming / Beth McKiernan 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
Glossary
2D, 3D Two / three dimensional (in relation to seismic surveys).
boe Barrels of oil equivalent.
boepd Barrels of oil equivalent per day.
E&P Exploration and production.
P2 Proven plus Probable reserves.
Probable Probable reserves are those unproved reserves which analysis of geological and engineering data suggests are more likely than not to be recoverable in this context and when probabilistic methods are used, there should be at least a 50 per cent probability that the quantities actually recovered will equal or exceed the sum of estimated proved plus probable reserves.
Proved Proved reserves are those quantities of petroleum which, by
analysis of geological and engineering data, can be estimated with reasonable certainty to be commercially recoverable, from a given date forward, from known reservoirs and under current economic conditions.
Tcf Trillion cubic feet.
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. He has compiled, read and approved the technical disclosure in this regulatory announcement. The technical disclosure in this announcement complies with the SPE/WPC standard.
Notes to Editors:About Northern
Northern Petroleum Plc (NOP) is an oil and gas company with exploration, development and production assets in the Netherlands, Italy, UK and Guyane. The Company's strategy is to acquire low entry cost exploration, production and development assets. Through undertaking geological, geophysical and engineering work, Northern adds value to shareholders both from production and asset sales.
At present Northern has independently assessed reported P2 reserves of in excess of 102 million barrels of oil equivalence ("mmboe"). In The Netherlands, where Northern has P2 reserves of 42.5 mmboe, the Company has six gas fields in production. In Italy, where Northern has reported P2 reserves of 53.16 million barrels of oil ("mmbbl"), Northern is a joint venture with Shell covering six permits and is pursuing a farm-out strategy. In the UK, Northern has 7.02 mmbbl of reported P2 reserves. In Guyane, Northern is a partner with Tullow, Shell and Total. Northern's reserve position is detailed within the Company's 2010 Interim Report dated 29th September 2010 which is available on Northern's website.
Northern is well capitalised, has a track record of partnering with oil majors and is run by a senior and experienced management team.
Now that Wijk en Aalburg is in production, Northern is forecasting a production rate of between 2,200-2,300 boepd. This rate of production will increase as additional oil and gas fields in the Netherlands come on stream.
Northern is listed on the AIM market of the London Stock Exchange, www.northpet.com
Northern in Italy
It is in Italy that the Company manages its largest licensed exploration area, predominantly offshore, but includes five onshore permits in the Po Valley gas and oil province in the north of the Italy. Exploratory evaluation of six offshore thrust belt licences, on which last year Northern acquired a 1520 km² 3D seismic survey, is being undertaken in partnership with Shell Italia E&P S.p.A.
In December 2010 Northern concluded an agreement for Orca Exploration Group Inc. to finance the drilling of the La Tosca prospect in the Longastrino permit in the eastern Po Valley Basin.
Also in 2010 ADX Energy Limited reported an oil discovery in Tunisian waters near to Northern's CR147 permit offshore of the Italian island of Pantelleria. Northern has mapped several prospects up-dip of the Lambouka-1 discovery well and outside the new 12 nautical mile zone of drilling exclusion.
The Italian assets contribute to 53.2 million boe of the reported net P2 reserves. Upon completion of the agreement with Azimuth, Northern's net Probable reserves in Italy will be reduced to 45.2 million boe.
About Azimuth Limited
Azimuth Limited is a specialist E&P business created to acquire prospective oil and gas assets worldwide.
Azimuth has purchased a licence to view, under certain terms and conditions, a global multi client data library which contains approximately 400,000km² of 3D seismic data and approximately 200,000km of 2D seismic data across the world's most prospective oil and gas basins.
Drawing on a pool of 85 technical experts, Azimuth is well positioned to discover and analyse E&P assets and to support its joint venture partners in their search for commercial reserves.
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