Afren plc and its partner, Oriental Energy Resources, has signed a rig contract with Transocean, commencing in September 2009. The Adriatic IX jack up drilling rig has been secured at a rate of US$97,000 per day for the first 250 days of operations, with a rate of US$85,000 per day there-after, based on a 425 day extension.

The Adriatic IX rig will be used to carry out an extensive drilling campaign at the Ebok Field located in OML 67, offshore Nigeria. Pending Government approval of the formal Field Development Plan, Ebok Field development will commence with the drilling of six horizontal production wells and one vertical water injection well. Two appraisal wells to test the additional upside potential within the Ebok West Fault Block and D2 Southern Lobe of the Field will also be drilled.

The Ebok Field Development Plan (“FDP”) has been submitted to the Nigerian Department of Petroleum Resources (“DPR”), and contract negotiations are at an advanced stage for field production facilities and requisite infrastructure.

Project background and key highlights - Originally discovered in 1968, the Ebok-1 well encountered four oil bearing sands, which significantly de-risked the project at the outset. - Appraisal drilling by the Afren/Oriental partnership in Q4 2008 proved 2P reserves of 53 mmbbl in the Fault Block 1 & 2 areas of the field (in excess of pre-drill minimum economic field size of 20 mmbbls). - Upside potential of an additional 99 mmbbls identified (includes 45 mmbbls in Qua Iboe sands). - Total un-risked resource potential of 152 mmbbls.

Osman Shahenshah, Chief Executive of Afren, said, “We are pleased to have secured a drilling unit at a very competitive rate, and to have extended our working relationship with Transocean, who provided the Trident IV drilling rig for the Ebok-4 appraisal well and also the Adriatic VI drilling rig for the successful seven well development drilling campaign at the Okoro development. The signing of this contract is an important milestone for the Ebok project, which remains on track to achieve a target of 15,000 bopd in early 2010, increasing to 35,000 bopd by the end of 2010.”

Alhaji Mohammed Indimi, Chairman of Oriental, said, “We are delighted with the finalisation of the rig contract that will see development drilling commence at the Ebok Field in September 2009. Oriental has worked diligently with our partner Afren to rapidly progress to First Oil at Ebok since successfully production testing the Ebok-4 Appraisal well in January of this year. Oriental looks forward to delivering one of the largest independent oil developments in Nigeria to date as a major milestone in the Nation's Indigenous Program.”

Tags: Afren plc