Afren

Afren PLC ("Afren"), an independent oil and gas company focused on establishing itself as the leading pan-African exploration and production company, announces the signature of a Financing and Production Sharing Agreement with Bicta Energy & Management Systems Limited ("Bicta") for participation in the development of the Ogedeh Field, offshore Nigeria ("Ogedeh").

Ogedeh is an undeveloped oil and gas field located in the shallow water offshore Niger Delta region in Nigeria. It was discovered by Chevron in 1993 on Oil Mining Licence 90 ("OML 90") by the Ogedeh-1 well, 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 49º API oil from two zones at levels similar to those in Ogedeh. Ogedeh is fully covered by 3D seismic and technical analysis indicates that the Ogedeh licence area holds hydrocarbon prospective resources likely to be in the range of 10 to 25 million barrels of oil, with gas reserves in the order of 25 BCF. Ogedeh is located offshore in 40ft of water, approximately 12kms from nearby production infrastructure which is linked directly to the oil export terminal at Forcados. The field is a conventional Niger delta structure, with oil and gas at shallow levels, and is likely to be a low cost development.

Ogedeh was recently awarded to Bicta after a competitive tender under the Nigerian Government's Marginal Field Allocation programme. The Financing and Production Sharing Agreement signed between Afren and Bicta defines the commercial terms under which Afren will participate with Bicta in the development of Ogedeh. Under the terms of this agreement, Afren will be responsible for paying all costs for the development of the field, and will be able to recover those costs via an allocation of oil and gas produced from the field. After all costs have been recovered, Afren and Bicta will share equally in the production.

Afren is currently investigating the market to contract a rig to drill its first well on Ogedeh, which will be tested. Future development plans would include a further one or two wells, and a tie-back to nearby infrastructure. Afren anticipates that successful development wells will produce at rates in excess of 2,500 barrels per day.

Brian O'Cathain, Chief Executive of Afren, commented:
"We are delighted to announce this first agreement to participate in the development of proven undeveloped fields in Nigeria which have the potential to generate material early production and cashflow for Afren. We are in active negotiation on a number of similar projects elsewhere in Nigeria, and we expect to have further announcements of progress in this area, and other deals in West Africa in the near future."

For further information, please contact:

Afren plc    
Brian O'Cathain boc@afren.com +44 (0) 20 7182 1800

Pelham Public Relations    
Charles Vivian charles.vivian@pelhampr.com +44 (0) 20 7743 6672
Alisdair Haythornthwaite alisdair.haythornthwaite@pelhampr.com +44 (0) 20 7743 6676

Afren is an independent oil and gas exploration, development and production company, established in 2004 to build an attractive, diversified and balanced portfolio of African assets, with an initial focus on the Gulf of Guinea region. Afren's corporate objective is "Capital appreciation for shareholders through preferential access to oil and gas production and exploration acreage acquisition, production growth, deal flow and exploration drilling in Africa."

Notes to Editors:

The Ogedeh Field is one of 24 proven oil and gas fields which were recently awarded to indigenous companies under the Nigerian Government's Marginal Field Allocation programme. This programme forms part of the Government's efforts to encourage the development of the indigenous oil and gas industry in Nigeria.