Europa Oil & Gas Regulatory News (EOG)

29 Jan 2009 07:00

Operational Update

Spudding of Hykeham-1, UK East Midlands

The Directors of Europa Oil & Gas (Holdings) plc are pleased to announce that drilling operations commenced on the Hykeham-1 exploration well on the 27th January 2009. The top-hole section of the well, to approximately 100m, will be drilled, cased and the well suspended for re-entry in mid-2009 to complete the main section of the well.

Hykeham-1 is being drilled on a well-defined four-way dip-closed feature at the Namurian Basal Sandstone level, the main reservoir in the nearby Whisby Oilfield. The Hykeham Prospect has a common spill-point with the Whisby Oilfield, only 2.2km away and where Europa's 2003 Whisby-4 well, which came in at 500bopd, has produced almost 300,000 barrels of oil to date and continues to produce in excess of 100bopd. In addition, a nearby well situated down-dip from the Hykeham-1 location, Caledonian Farm-1, contained a live oil column in the Basal Sandstone sequence. Additional potential also exists in Hykeham-1 in overlying Westphalian sandstones, which are oil-bearing in Whisby-4. A geochemical survey over this area highlighted a positive surface chemical anomaly at Hykeham.

Paul Barrett, Managing Director of Europa, said `The Hykeham Prospect is low risk, all the necessary elements of reservoir, structure, migration and seal being amply demonstrated in the seismic and well data. Europa produces over 250bopd from its existing East Midlands assets and success later in 2009 would allow for immediate test production to augment this cashflow stream.'

For further information, please contact;

Paul Barrett Europa Oil & Gas (Holdings) plc 01235 553 266 Jonathan Wright Seymour Pierce 0207 107 8050

www.europaoil.com

NOTE

Hykeham-1 is situated in licence PEDL150. On completion of Hykeham-1, the equity interests in PEDL150 will be:

Europa 50% (Operator)

Valhalla Oil & Gas 50%

REVIEW BY QUALIFIED PERSON

The technical information and opinions contained in this announcement have been reviewed by Dr. Erika Syba, Operations Director of Europa Oil & Gas, who is a geologist with 19 years of relevant experience in the oil and gas industry.