Northern announces that it has signed a binding Heads of Agreement with ATI Oil Plc (“ATI”), the principle terms of which are as follows:

• A subsidiary of ATI will assign to Northern Petroleum (UK) Limited (“NPUK”) its entire economic interest in exploration licences G.R17.NP, G.R18.NP, G.R19.NP, G.R20.NP, G.R21.NP and G.R22.NP in exchange for a 1.5% gross overriding royalty over 30% of NPUK’s post farmout percentage in the six licences;

• A subsidiary of ATI will assign to Northern Petroleum (UK) Limited (“NPUK”) 40% of its economic interest in exploration licence C.R147.NP, reducing its economic interest to 10%; and

• Northern will extend the existing £2 million loan facility to ATI until 31 December 2011 at a fixed interest rate of 8.125%.

Relationship between Northern and ATI

Northern currently has a 37.05% shareholding in ATI and Derek Musgrove and Chris Foss, directors of Northern, are also directors of ATI. The Directors of Northern who are independent of ATI, having consulted with Northern’s nominated adviser, Investec, consider the provision and terms of the agreement are fair and reasonable insofar as Northern’s shareholders are concerned.

For further information please contact:

Northern Petroleum Plc
Tel: +44 (0) 20 7469 2900
Richard Latham, Chairman
Graham Heard, Exploration & Technical Director

Investec
Tel: +44 (0) 20 7597 5000
Michael Ansell / Patrick Robb

Blue Oar
Tel: +44 (0) 20 7448 4400
Jerry Keen

Bishopsgate Communications (Press)
Tel: +44 (0) 20 7562 3350
Nick Rome / Maxine Barnes

Buchanan Communications (Analysts)
Tel: +44 (0) 20 7466 5000
Tim Thompson / Ben Romney