Cabot Energy Regulatory News (CAB)

NORTHERN PETROLEUM PLC - Northern to be Issued 5,800 km² Shale Oil Licence

PR Newswire

London, May 29

The Government of South Australia has announced a wholly owned subsidiary ofNorthern Petroleum Plc (AIM:NOP) as the successful bidder for 100% of PetroleumExploration Licence (PEL) 629 covering an area of 5,800km2 with shale oilprospectivity in a so far lightly explored but producing portion of the onshoreOtway Basin with five gas fields having significant amounts of condensate. Onlyfive stratigraphically deep exploration wells have been drilled within thelicence and some 4,468 line kilometres of 2-D seismic data recorded. The awardis for an initial period of five years

PEL 629 is also prospective for conventional oil and gas, but Northern willfocus on the unconventional potential of the Late Jurassic to Early CretaceousCasterton and Sawpit Formations. The initial programme will be detailedgeochemical analysis and seismic reprocessing, combined with state of the artwireline log processing for evaluating the potential unconventional shalesequences for light oil, condensate and gas potential.

The Otway Basin is South Australia's second most prospective onshore oil andgas province with land releases attracting competitive bids from bothAustralian and international petroleum explorers.

Derek Musgrove, Managing Director of Northern Petroleum stated:

"Northern's first steps into shale oil came through an increasing recognitionof the high potential within its licences in the West Netherlands Basin. TheCompany rapidly developed an understanding and some in-house expertise in thegeological requisites for a good shale oil play.

With these newly acquired strengths on board it was natural to extend ourinvestigations into our licensed areas of the south of England and suitablebasins elsewhere that fitted our business model screening factors of low entrycost and early stage commitments, attractive legal and fiscal terms, apre-existing petroleum infrastructure in the basin, good cultural compatibilityand a projected ability to bring in new partners to bear much of the highercosts.

Australia was quickly identified and a local highly experienced consultant wellknown to the Company was retained and the helpfulness of the South Australianstate authorities a benefit.

The Otway Basin is seen as particularly attractive for its existinginfrastructure and possibilities for the rapid development of any discoveries.Northern will bring to the project its considerable successful experience andhigh standards of operating in collaboration with its neighbours in beautifuland environmentally sensitive areas, including The Southdowns National Park inthe south of England.

Further opportunities to acquire acreage by application elsewhere in theonshore and offshore continue to be examined aided by the presence ofsupportive state and federal governments and an attractive well organisedsystem of release of seismic and well data at low costs."

In accordance with the AIM Rules - Guidance for Mining and Oil & Gas Companies,the information contained in this announcement has been reviewed and signed offby the Exploration and Technical Director of Northern, Mr. Graham Heard CGeol.FGS, who has over 35 years experience as a petroleum geologist. He hascompiled, read and approved the technical disclosure in this regulatoryannouncement. The technical disclosure in this announcement complies with theSPE/WPC standard.

For further information please contact:

Billy Clegg / Victoria Huxster

Northern is a full cycle oil and gas company currently holding numerouslicences in a number of low risk areas and is continuing with its strategy ofadding and securing value for shareholders as it engages with projects at allstages of the E&P value chain.

Comprehensive information on Northern and its oil and gas operations, includingall press releases, annual reports and interim reports are available fromNorthern's website at www.northpet.com.