BG Group to Acquire Norway Interests from Paladin Resources

BG Group has reached agreement with Paladin Resources to acquire, for US $2 million, a proportion of Paladin's interests in three license areas in the Norwegian North Sea.

The blocks lie adjacent to the UK-Norwegian median line immediately north of the BG 100% owned and operated PL297 Blocks 1/2, 1/5 and 1/6 located in the Central Graben area of the Norwegian North Sea.

Under the arrangement, BG will acquire an initial 30 per cent in PL 143, 20 per cent in PL 143CS and 20 per cent in PL 298. In addition, BG will acquire a further 10 per cent of PL 143 dependent on future exploration activity.

The effective date for the transaction is July 1, 2004. The transaction is subject to the approval of the Norwegian National Petroleum Directorate and the Ministry of Petroleum and Energy. Completion is expected in the first quarter of 2005.

In December 2003, BG was selected for the operatorship - and 100 percent ownership – of Blocks 1/2, 1/5 and 1/6 in Norway's first Predefined Areas licensing round. Seismic was shot over the blocks in 2004, and the drilling program will begin in 2006. In June 2004, BG was also awarded interests in two licenses in the 18th Norwegian offshore licensing round. These comprised 30 per cent of Blocks 6504/1 (part block), 6504/2, 6504/4 and 6504/5 (operated by ENI) and 30 per cent of Blocks 6503/9, 6504/7 and 6504/11 (operated by ChevronTexaco). In August 2004, BG also announced that it has had signed a Sale and Purchase Agreement with Lundin Petroleum AB, under which it acquired a 60 per cent interest in Lundin's 100 per cent owned license PL 292 in the Central Norwegian North Sea , with an option to acquire a further 10 per cent interest.