Faroe Achieves First Gas from Minke Main

Faroe Petroleum has started gas production from the Minke Main gas field in the Southern North Sea.

The Minke Main field (in block 44/24a) is located in the UK Southern Gas Basin, near to the UK-Dutch median line, approximately 25 kilometers east of the producing Caister-Murdoch gas fields and 13 kilometers south west of the D15 platform in the Dutch sector. Located in 45 meters of water, the field is operated by GDF Britain and has been developed as a single well sub-sea tie-back to the D15 platform facilities located offshore Holland. Net reserves attributable to Faroe Petroleum in respect of Minke Main are estimated to be 2.57 billion cubic feet of gas.

Production from the field will be 60 million standard cubic feet of gas per day equating to approximately 600 barrels of oil equivalent per day net to Faroe. The gas will be transported via a new 15 kilometer pipeline to the Dutch D15 platform (operated by the Gaz de France affiliate GDF ProNed), where it enters the existing NGT Pipeline System for delivery at Uithuizen in the Netherlands. Faroe Petroleum has entered into a gas sales agreement with Gaz de France S.A. to buy its equity share of gas under a traditional oil-indexed contract.

The ownership interests in the Minke field are GDF Britain Ltd (15.6% and operator), E.ON Ruhrgas UK Median Limited (42.7%), RWE Dea UK (35.8%) and Faroe Petroleum (U.K.) Limited (5.9%).

Graham Stewart, Chief Executive of Faroe Petroleum, commented:

"I am delighted that Faroe Petroleum has secured its first production, which represents a significant milestone for the Company. We have brought to fruition the first step towards generating strong cashflow designed to make a material contribution towards financing our exploration and appraisal activities focused on the UK and Faroese Atlantic Margin, the North Sea and Norway.

"GDF have done an excellent job bringing this challenging field safely to production with the well achieving production rates up to 75 million standard cubic feet of gas per day on test when drilled. Minke Main is one of three undeveloped gas field discoveries we acquired in mid 2006 from ConocoPhillips as a package of license interests. The other two undeveloped discoveries in the package are the adjacent Minke Graben, which may be drained through Minke Main, and the Orca gas fields with two tested discovery wells. These fields offer considerable additional reserve and value potential to Faroe Petroleum, and development decisions for them are anticipated later this year."

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