Europa Oil & Gas Has Begun Work on Bilca Development Project

Europa Oil & Gas has signed the construction contract for the Bilca Gas Development in Romania.

The contract was awarded to Condmag SA, Brasov and Inspet SA, Ploiesti, both large Romanian contractors. The installation comprises the production facilities, flowlines and export lines for a complex of three gas fields (Bilca East, Bilca West and Fratauti) situated in the EIII-1 Brodina Block, in which Europa holds a 28.75 per cent. interest. The work will commence immediately and the facilities are expected to be completed in early 2006.

The Bilca and Fratauti gas discoveries were drilled between May 2004 and March 2005 and flowed at rates between 6.3 mmscfpd (approximately 1,000 boepd) and 12.7 mmcfgpd (approximately 2,000 boepd) respectively.

The Brodina Block contains a further Bilca 'look-a-like' prospect (Costisa-Radauti-1) for which drilling consent was obtained from the Romanian government earlier this month. The Directors anticipate that this well will be drilled in 2006. In addition, work will continue to identify further prospects on the Block with a seismic survey planned for early 2006.

Paul Barrett, Managing Director of Europa, said:
"The continued progress on this project demonstrates our commitment to the program we set out in our AIM prospectus. This project is on track to increase our production substantially in 2006 whilst the parallel exploration work in Romania is expected to increase our reserves and resources further over the coming year."