Faroe Petroleum Plc Regulatory News (FPM)

6 Jun 2006 07:01

Faroe Petroleum PLC06 June 2006 6th June 2006 Faroe Petroleum plc ("Faroe Petroleum", "Faroe" or the "Company") Faroe Petroleum secures its first gas interest in Southern North Sea Faroe Petroleum, the independent oil and gas company with a portfolio of 15licences in the Faroes, West of Shetland and the North Sea, is pleased toannounce that in line with its stated strategy to enhance portfolio diversityand reduce overall risk profile, it has taken its first step towards building anew position in the UK Southern North Sea Gas Basin with an acquisition. FaroePetroleum's North Sea strategy is designed to complement the Company'ssignificant Atlantic Margin portfolio, by focusing on opportunities close toexisting production infrastructure, with potential to generate early cash flow. The Company is pleased to announce the acquisition from Sterling Resources (UK)Limited of a 10.0% equity stake in Blocks 42/13 and 42/12 (operated bySterling), which contain the Breagh gas discovery as well as un-drilled leadswith good upside potential. The discovery offers low risk scope to open anexciting new core area for Faroe Petroleum in the Southern North Sea, tocomplement its Atlantic Margin, Central North Sea and new Norway focus. An appraisal well is planned to be drilled adjacent to the discovery well 43/12-2, in order to establish commercial reserves which if successful would leadto early development. Graham Stewart, Chief Executive of Faroe Petroleum, commented: "As UK's demand for indigenous gas continues to grow, this move introduces somediversification for Faroe Petroleum into gas opportunities to complement thepredominance of oil prospects in our portfolio. This exciting first step intothe Southern North Sea drew upon the considerable experience our team has builtfrom working in the SNS and in particular in gas field development. Theappraisal well, which we expect to drill in 2007, will add further activity toour advancing drilling programme over the coming period. " - Ends - Enquiries: Faroe Petroleum plcGraham StewartTel: 01224 652 810gstewart@faroe-petroleum.com Financial DynamicsJonathon Brill/Billy Clegg/Caroline StewartTel: 0207 269 7157billy.clegg@fd.com This information is provided by RNS The company news service from the London Stock Exchange