Northern to Sell Spanish Exploration Licenses to Ascent Petroleum

Northern has entered into an agreement to sell, subject to government consents, its 50% interest in its Spanish exploration concessions to a subsidiary of Ascent Resources Plc in return for a 2.5% over-riding royalty derived from any future production. Ascent has stated its intention to invest in an appraisal program, with the drilling of two wells as the first priority.

This agreement does not include Northern's interest in the Ayoluengo producing oil field.

Derek Musgrove, Managing Director, stated:

"Our review of these licences has led us to a decision not to drill these three prospects. Rather, we have chosen to benefit from any success resulting from another company's efforts, without exposure to further costs, by means of an over-riding royalty and to focus our resources, both human and financial, on other development and exploration projects of greater potential within our portfolio including our projects in Holland.

Northern's subsidiary, NP Netherlands B.V., has committed to the development of two onshore Dutch discoveries with an option to commit to a further three, prior to the end of the year, pending the approval of the relevant government authorities. NPN estimates the gross expected in-place volumes of the two committed discoveries to be 102 billion cubic feet of gas and 6.3 million barrels of oil."