Ramco Says Tests Indicate Lower Reserves at Seven Heads Fiel

Ramco Energy provides an update on the status of the Seven Heads Field off the coast of Ireland. The well performance diagnostic program outlined in our release of March 3rd has been successfully completed. The Seven Heads field is adjacent to Ireland's largest producing gas field, Kinsale, which is operated by Marathon. It is expected to contribute about 10-15% of Irish demand for gas in 2004.The field returned to production on March 17th following three days when it was shut in to enable the program to be carried out.

The pipeline depressurization or "blow-down" process confirmed there had been a measurable build-up of water in four of the five wells with a maximum column of 190 ft of water in one well bore. Our technical team believe the process successfully removed most of that water from the wells enabling more accurate reservoir pressures to be obtained.

The wellhead pressures and production rates of the wells affected by water build-up showed a temporary improvement following the diagnostic program. Over the 5 days prior to the program the average field production was 35.8 mmscf/d and immediately following completion of the program the field averaged 40.2 mmscf/d over the 5 days to March 22nd. Since then the field production rate has returned to levels observed before the process commenced.

The data acquired during the test program suggests that each well is connected to a lower volume of reserves than had been expected and that the dual permeability system is making only a limited contribution to production. The acquired data together with production data to be collected over the next several months will be used to reassess the field's future deliverability and recoverable reserves. Our understanding of what is a significantly more complex reservoir than we had thought now requires a fundamental reappraisal. Ramco will be postponing its preliminary announcement for the year ended December 2003, until early May, to allow an initial reassessment of reserves to be completed.

The technical team is considering the costs and benefits of gaining access to compression facilities on the Kinsale platform which could be adapted to facilitate Seven Heads gas production. The Transportation, Processing, and Operational Services Agreement, signed with Marathon in April 2003, provides that the Seven Heads partners share the operating costs of Marathon's Kinsale facilities pro rata, on a throughput basis.

The Seven Heads partners are Ramco (Operator) 86.5%, Island Petroleum Developments Limited 12.5% and Sunningdale Oils (Ireland) Limited 1.0%.