Paladin Makes Fourth Tunisian Oil Discovery

Paladin announces the discovery and successful testing of oil and gas in its Nour-1 exploration well in the Adam production concession in southern Tunisia.

The well, operated by ENI Tunisia B.V. ('ENI'), was spudded on March 14th and encountered an aggregate 48 meters of net oil and gas condensate pay and 10 meters of net gas pay in the Acacus and Tannezuft Formations over a gross interval of approximately 300 meters at depths of 3,200 to 3,500 meters. These zones are equivalent to productive zones in the nearby producing Adam, Hawa and Dalia Fields, discovered by the joint venture during the last 3 years.

During preliminary testing to clean-up the well, oil and gas were produced at rates of approximately 2,800 bopd and 15.6 mmscfgpd, respectively. The drilling rig has moved off location and subsequent production testing of all intervals will commence next week. The well will then be linked to the existing process and export facilities some 13 km distant. Paladin anticipates that field production will commence around the middle of this year.

Paladin's current interest in the Adam Concession, which contains the Nour Field, is 7%.

Roy Franklin, Chief Executive of Paladin, commented:
'This is the Company's fourth consecutive exploration success in Tunisia and, like earlier discoveries, will be rapidly tied back to the existing facilities. The Adam concession has become the largest single oil producing concession in Tunisia and we hope to be able to continue an active investment program to build upon that position.'