Northern Petroleum Plc is pleased to announce that its wholly owned subsidiary NP Weald Limited (“Northern”) has entered into a farm-out agreement with Hereward Ventures plc (“Hereward”) in respect of the Company’s interest in UK onshore hydrocarbon exploration licence PEDL 154.

Northern, the licence operator, has agreed to sell Hereward a 10 per cent. interest in the licence with an option for Hereward to acquire a further 10 per cent.

Under the terms of the agreement Hereward will pay to Northern the sum of £10,000 and assume responsibility for 10 per cent. of further costs. In order to be in a position to exercise the 10 per cent. option, Hereward has undertaken to pay an additional 20 per cent. of further costs. The date of the assignment shall be as soon as practicable subject to any necessary consents to be granted by the Secretary of State for Trade and Industry. The exercising of this option by Hereward would result in Northern retaining 30 per cent. ownership of the licence whilst paying only 20 per cent. of the costs.

The licence, located on the southern flank of the Weald Basin, is projected to be at the eastern end of the Horndean and Singleton trend and surrounds the Storrington oilfield which produces oil and gas from the middle Jurassic Great Oolite limestone.

The Weald Basin is a proven oil province. The only three wells drilled in the licence area have all encountered hydrocarbons, the last of which was the Washington-1 well in 1979, proving migration into the area south of Storrington, thus increasing the prospectivity of PEDL 154.

The seismic data on this licence area has not been interpreted in a modern workstation environment. It is anticipated that both untested discoveries and undrilled prospects exist within the licence area that can be established utilising modern evaluation and drilling completion techniques in an area where oil sourcing and entrapment is already proven.

Further enquiries:

Northern Petroleum Plc
Derek Musgrove, Managing Director
Chris Foss, Company Secretary Tel: 020 7743 6080

Hansard Communications
Chris Roberts/Ben Simons Tel: 020 7245 1100