Paladin Receives DTI Approval for Brechin Field Development

Paladin Resources and its joint venture partner, Energy North Sea Limited, a subsidiary of Marubeni Corporation, have received DTI approval for the development of the Brechin oil field which is located close to the Montrose, Arbroath and Arkwright ('MonArb') field complex. The anticipated cost of the development is 21 million.

The Brechin Field was discovered in May 2004 by Paladin's first UK operated exploration well 22/23a-7, which penetrated 138 ft of oil-bearing Palaeocene Forties Sandstone. The field will be produced by a single horizontal development well tied back to the existing Arkwright Field subsea infrastructure approximately 3.4 km away. Oil will then be transported via pipeline for processing on the Montrose Field platform and onward export to shore via the Forties Pipeline System. Production will start in July 2005, fourteen months after field discovery, and will peak at over 5,000 barrels per day.

The interests of the joint venturers in the Brechin Field development and in the MonArb Fields are Paladin (operator) 58.97 per cent and Energy North Sea Limited 41.03 percent.

Colin Reid, the Company's Aberdeen-based UK General Manager, commented:

'This fast-track development of the Brechin Field is an excellent example of exploitation of the remaining potential around mature infrastructure in the North Sea. It also demonstrates the organic growth potential of the MonArb area and the ability of Paladin and its partner and contractors to pursue such opportunities quickly.'

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