Afren

Ogedeh Field (OML 90)

Background

The Ogedeh Field (“Ogedeh”), was awarded to Bicta - a well established indigenous oil company - in the 2003 Nigerian Marginal Field round. Ogedeh is an undeveloped field in OML 90, located offshore in the Northern Niger Delta.  The field was discovered by Chevron in 1993 (Ogedeh-1) which logged oil and gas in a number of zones.  The discovery well was not tested but a nearby well flowed over 4,000 barrels oil per day of 49 degree API oil from two zones at levels similar to those in Ogedeh.  The field is fully covered by 3D seismic and technical analysis indicates it is expected to contain approximately 5 - 15 million barrels of prospective recoverable oil resources.  The field is located in approximately 40 feet of shallow water and within 12 km of nearby production infrastructure.  It is a conventional Niger Delta structure with oil and gas at shallow levels, and is likely to be a low-cost development.

Terms

In June 2006, Afren signed a Financing and Production Sharing and Technical Services Agreement with Bicta, for participation in the development of Ogedeh.  Under the terms of the agreement, Afren will finance the development programme. On production, Afren will recover these costs with an uplift on its capital, from over 90 per cent of the barrels produced, net of operating costs and royalties. Following cost recovery, Afren and Bicta will share the production.

Operations Update

Several development options are being reviewed, in conjunction with the owners of the other marginal fields in OML 90, Ajapa and Akepo. A cluster-development is currently the favoured concept.