Afren Hires Rig for Okoro / Setu Project

Afren's Nigerian subsidiary Afren Energy Resources Limited has signed a drilling contract for GlobalSantaFe's Adriatic VI jackup to carry out development drilling on the Okoro / Setu fields offshore Nigeria.

AER signed a nine month contract with GlobalSantaFe which will commence in August 2007, to carry out an extensive drilling program to complete development of the Okoro and Setu Fields in OML 112, offshore Nigeria. This will allow the drilling of the production and injection wells required to complete the Okoro / Setu development program.

Okoro and Setu are proved undeveloped oil and gas fields located in OML 112 in shallow water offshore Nigeria, which were originally awarded to AMNI International Petroleum Development Company Limited ("AMNI") in 1993 as part of the Nigerian government's indigenous licensing program. In June 2006 Afren announced the signing of a Financing and Production Sharing and Technical Services Agreement with AMNI. The fields have combined estimated recoverable reserves of 35 to 60 million barrels ("MMbbls") and are expected to flow in excess of 15,000 barrels of oil per day ("bopd") when full combined production is achieved. First oil is expected in early 2008.

Project Update

The Seadrill 7 is being mobilized to commence appraisal drilling on Okoro / Setu development at the end of September 2006. The planned program includes an appraisal well to test upper and lower reservoirs at Okoro and a re-entry and re-drill of the Setu-1 well.

The Adriatic VI drilling unit will be utilized for a 9 month program starting in August 2007 to carry out the development drilling on the Okoro and Setu fields. First production is expected in early 2008.

The decision to use the Adriatic VI drilling unit on the Okoro / Setu development will maximize value on Afren's most important asset. Discussions are currently ongoing to secure an additional rig contract for the Ogedeh development.

Overall, the Company is targeting production of 15,000 to 20,000 bopd by 2008 from its existing portfolio.

Brian O'Cathain, Chief Executive, commented:
"We are pleased to have secured such an excellent drilling unit in a difficult market, to allow Afren and AMNI to keep the Okoro/Setu project on track for our target of 15,000 to 20,000 bopd by early 2008."

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