Afren

London, 18 July 2007 - Afren plc ("Afren" or "the Company") announces that it has entered into a Financing and Technical Services Agreement with Excel Exploration & Production Limited ("Excel") for the development of the Eremor Field in Nigeria.

The Board of Afren is delighted to announce that it has entered into an agreement with Excel, an established indigenous Oil & Gas company, to jointly develop the Eremor Field ("Eremor"), an undeveloped oil field in OML 46, located in shallow water off-shore Nigeria.

- Excel was awarded a 100 per cent. interest and operatorship of Eremor under the Federal Government of Nigeria's Marginal Field Programme.
- The field is covered by 3D seismic data and is estimated to contain in place volumes of up to 30 million barrels in the D3.0 reservoir, with a similar potential upside in the shallower D1.0 reservoir. Recoverable reserves are estimated at up to 10 million barrels from the D3.0 reservoir.
- Eremor is located close to existing infrastructure and within 12 kilometres of a number of Shell producing fields.

The field was initially discovered by Shell in 1978 (Eremor-1), and encountered five hydrocarbon bearing zones:

- Three additional wells were drilled to appraise the areal extent of the accumulation between 1984 and 1990.
- The Eremor-1 well was re-entered in 2005 and a short production well test performed on the D3.0 interval.
- Good oil samples were recovered of a low Gas to Oil Ratio, 22 degree API crude. Analysis of the test data indicates that flow rates of up to 2,000 bopd are achievable from the vertical well.
- Eremor-1 is currently suspended and suitable for re-completion.

Phase-1 of the Field Development Plan includes completion of the existing well and construction of a 7-kilometre oil evacuation line to the nearest flow station. The Field Development Plan and Environmental Impact Assessment have been approved and development work will commence in the near term.

The agreement signed between Afren and Excel defines the commercial terms under which Afren will participate with Excel in the development of Eremor. Under the agreement, Afren will be responsible for financing Phase-1 of the Field Development Plan, and will initially recover the investment from 90 per cent. of net field revenues. Following cost recovery, Afren and Excel will equally share production revenue and costs.

Osman Shahenshah, Chief Executive of Afren, commented:
"I am delighted to announce Afren's fourth partnership with a well established indigenous company in Nigeria, which underpins Afren's commitment and strong competitive position to develop relatively low risk fields with significant near term upside that provide early cash flow and add to our growing reserve base. This follows the recent announcement of a Farm-In Agreement with Independent Energy for participation in the Ofa Field and takes Afren's portfolio to 11 assets in 5 Countries, achieved in just over 2 years, offering a combination of both on-shore and off-shore near-term development and high impact exploration opportunities, with 15,000 to 20,000 barrels of oil per day from the existing portfolio by mid-2008."

Enquiries:

Afren plc   +44 (0) 20 7182 1800
Osman Shahenshah Chief Executive  
Evert Jan Mulder Chief Operating Officer  
Galib Virani  Investor Relations  

Jefferies International Limited   +44 (0) 20 7618 3500
Toby Hayward    
Oliver Griffiths     

Tristone Capital Limited   +44 (0) 20 7399 2480
Simon Ashby-Rudd    
Majid Shafiq    

Pelham Public Relations   +44 (0) 20 7743 6673
James Henderson    
Alisdair Haythornthwaite    

Background information

EXCEL Exploration & Production Company Limited ("EXCEL")

EXCEL was established in 2001 as an indigenous exploration and production company. In 2003, EXCEL was awarded a 100 per cent. interest and operatorship of the Eremor Field, located in three metres of water, on Shell's OML 46 in the Niger Delta.

EXCEL has a strong and diverse Board and Management team including Rear Admiral Madueke, Kunle Areogun, Abiodun Awosika, Engineer Afoloabi Oladele, Pastor Taiwo Odukoya and Chief (Mrs) Agama.

Afren Plc

Afren (www.afren.com) was founded in December 2004 by a management team including Dr Rilwanu Lukman, (Chairman), Osman Shahenshah, (Chief Executive) and Bert Cooper (Advisor to the Board), with the vision to become the premier pan African independent Exploration and Production company. Afren's Chief Operating Officer is Evert Jan Mulder, who was most recently Chief Operating Officer of Addax Petroleum, Nigeria's largest independent oil producer.

Since its listing on the AIM market of the London Stock Exchange, Afren has rapidly expanded its portfolio and the management team has delivered 11 assets in the Joint Development Zone of Nigeria São Tomé and Príncipe, Nigeria, Gabon, Angola and Congo Brazzaville. In addition. Afren has built an executive and non-executive management and advisory team with broad and extensive experience in the industry, both in West Africa and internationally; in identifying and completing corporate expansion opportunities and in public company financing. Afren also looks to leverage key relationships across the region to gain preferential access to opportunities.

Afren will continue to add to its diversified portfolio of near term development and high impact exploration, with the overall objective of creating substantial shareholder value.

Current portfolio

Nigeria

Today's announcement marks Afren's fourth partnership with an indigenous company in Nigeria, which is consistent with the strategy and commitment of partnering with indigenous companies to target low cost development options that yield near-term production.

- Okoro Setu development - Two appraisal wells were successfully drilled in Q4 2006 by Afren, the Technical Service Provider. A nine-month rig contract is in place for the Adriatic VI, with development drilling due to commence in Q4 2007. An FPSO has been secured, reserves certified by Netherland, Sewell and Associates (2P of 32 mmbbl) and the Field Development Plan has been approved by the Department of Petroleum Resources in Nigeria. First oil is targeted in Q1 2008 and circa 15,000 -20,000 bopd of oil achieved by mid 2008.
- Ofa development - Discovered by Shell in 1970. Upon a successful well test, production should be achieved within eight to nine months at up to 4,000 bopd.
- Ogedeh development - Existing discovery made by Chevron in 1993 in an area lying close to existing infrastructure. Various development options are currently under review.
- Eremor development - Initially discovered by Shell in 1978. Phase I of the approved Field Development Plan is to re-enter and complete Eremor-1.

Angola Cabinda Block B

Heads of agreement have been signed for a 5 per cent. interest in Block B, a high quality exploration license containing existing discoveries (32 wells previously drilled without Seismic (4 wells testing light oil and 7 wells with oil shows). A 2D seismic programme is planned, followed by a 5-well exploration programme from 2008 onwards once Force Majeure is lifted.

Congo

The La Noumbi field (Afren: 14% interest) lies adjacent to the M'Boundi field and contains a number of high impact exploration opportunities. A well will be drilled on the Doungou prospect in August 2007.

Gabon

Afren has interests in Themis and Iris Marin (12.86%) and the Ibekelia Study Area (20%), which offer low cost exploration upside. The Admiral prospect in Themis Marin is due to be drilled in H2 2007.

Nigeria - São Tomé Joint Development Zone

Afren's 4.41% interest in Block 1 of the JDZ offers exposure to a world class exploration acreage and in March 2006 Chevron made the Obo-1 discovery which contained 150 feet of net pay and proved a working hydrocarbon system in the JDZ.

Note

In accordance with the AIM Rules, the drilling update information in this report has been reviewed and signed off by Dr Nick Johnson, who is Head of Exploration and Production at Afren Plc and has over 25 years relevant experience within the sector. He consents to the information in the form and context in which it appears. The Company estimates its reserves in accordance with the guidelines and definitions of the Society of Petroleum Engineers/World Petroleum Congress ("SPE/WPC") reserves classification (March 1997) using accepted engineering principles.