Oilexco Says Halibut Well a Dry Hole

Oilexco and Faroe Petroleum report that the drilling results for the well at the Halibut prospect located in Blocks 14/21a and 14/22a in the UK Central North Sea indicate that there are no commercial quantities of hydrocarbons present. The well is being plugged and abandoned. The well was drilled by Dolphin Drilling's semisub Bredford Dolphin to a depth of 3,692 feet, and was targeting upper Jurassic Sandstones, with secondary targets in Lower Cretaceous Sandstones. Oilexco paid 80% of the drilling and historic survey costs to earn a 55% interest in the blocks.

"While we didn't achieve the results we were hoping for at Halibut, the well was drilled very quickly and very inexpensively, so the costs for this prospect were very low", said Oilexco President and CEO Arthur Millholland. "We have the Transocean Sedco 712 semi-submersible under contract until 2010, and plan to drill several wells during this time. The Sedco 712 is fully committed for the remainder of 2006, including a development well in our Nicol Field, appraisal work at our recently announced Disraeli find, and appraisal drilling on our Shelley and Kildare prospects to name a few."

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