Petroceltic Contracts 2nd Drilling Rig for Algerian Permit

Petroceltic announced the signing of a fully termed contract with KCA Deutag for a second drilling rig on the enlarged appraisal campaign on the Isarene Permit, as outlined in the recent funding announcement. KCA Deutag's Nomad class drilling rig T-211 will work alongside the existing Dalma Rig LR-12 on the Ain Tsila Field appraisal program.

Petroceltic has also signed two contracts for studies in support of the Final Discovery Report. These are with G3Baxi Partnership Limited for field development conceptual studies and with Ove Arup and Partners for a geotechnical study. These studies will assist with initial concept selection and the location of the facilities, infrastructure and pipelines for the Final Discovery Report.

The T-211 rig contract period is for up to three wells and, in conjunction with the existing rig, will allow the enlarged program of a minimum of six appraisal wells to be completed before the end of 2011, allowing sufficient time for the submittal of the Final Discovery Report on the Isarene Permit to the Algerian authorities. The T-211 rig recently completed a program in Algeria for another operator in the Illizi basin and is expected to commence mobilizing to the first well location in June 2011, with drilling operations likely to commence in July 2011.

Brian O'Cathain, Chief Executive of Petroceltic commented, "The contract for the second rig will see a significant increase in the pace of appraisal activity on the Ain Tsila discovery following the recent successful fund raising and the farm out to ENEL. The award of contracts for the conceptual and geotechnical studies is of importance as they mark the start of the move from the exploration and appraisal phases of the production sharing contract into the pre-development phase."