Anzon Begins Batch Drilling at Basker Location

Basker 2 Well
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Ocean Patriot
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Diamond Offshore's semisub, Ocean Patriot, has completed and tested the Manta-2A well. The well has been suspended for future production.

The Ocean Patriot has been moved to and anchored at the Basker location. The drilling operation for the Basker-3, 4 and 5 wells has commenced, utilizing a batch drilling approach. The batch drilling approach has been designed to drill each section of the three development wells sequentially. At this point, the conductor has been set and cemented on all three wells and the surface hole of Basker-3 is being drilled. Once the Basker-3 surface hole is cased and cemented the surface hole of the other two wells will be drilled. This approach is possible because the rig anchor pattern has been established in such a way that the rig does not need to be moored at separate locations for each of these three wells.

Production from the Basker-2 well has been continuous throughout the month of February 2006 with a total of 165k barrels of oil produced (averaged approximately 5,900 bopd) together with 1.26 bcf of gas and 6k barrels of water (approximately 4% water cut). To end of February 2006 cumulative oil production from Basker-2 is 548k bbls.

It is anticipated that production will continue until mid March 2006 before the next sale. Approximately 380k barrels of oil is expected to be sold around the March 23, 2006.

The participants in the Basker-Manta Joint Venture are Anzon as operator with 50% and Beach Petroleum with the remaining 50%.

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