Anadarko Makes Discovery on Block 404 in Algeria

Anadarko Petroleum Corporation and partners Maersk Olie Algeriet AS and Eni-Lasmo Oil (Algeria) Ltd, have made an oil discovery on Block 404 of the Berkine Basin in Algeria.

The SFSW-1 (Sif Fatima South West) discovery well is located 10 miles south of the recently announced discovery at Hassi Berkine North East (HBNE), seven miles east of the producing Hassi Berkine South East field and north-northeast of Sonatrach's discovery at Sif Fatima. The well was drilled to a total depth of 10,637 feet and encountered 36 feet of net oil pay in the TAGI reservoir. It tested at a rate of 2,689 barrels per day of 47 degree API gravity oil and 4.72 million cubic feet per day of gas with a flowing tubing pressure of 1,414 psi.

Djamel Eddine Khene, Vice President, Exploration and Production of Sonatrach, said: "This new discovery, which follows around 10 other discoveries made during the last two years in Algeria, confirms the success of the policy adopted by Sonatrach in partnering with foreign companies in its upstream activities. Sonatrach's abilities, particularly its excellent knowledge of the Algerian mining assets, complements the know-how and skills developed by Anadarko in working with these complex geological plays and has led to very encouraging results.

"Exploration activities undertaken with foreign partner associations in Algeria will practically triple in 2003 compared with 2002, and this is set to increase even further over the next few years. As part of this program, several blocks, including offshore exploration blocks, will be put out to tender," he said.

"This is our second discovery since resuming our exploration program in October, and we are very encouraged by the results," said Rex Alman III, Managing Director of Anadarko Algeria Company. "This discovery clearly demonstrates the excellent remaining exploration potential of Anadarko's portfolio in the Berkine Basin. These early successes support our goal to grow reserves through exploration drilling and help Anadarko achieve its long-term growth targets.

"Anadarko has an excellent record of exploration success in Algeria. Over the last 10 years, we have found 14 fields with reserves totalling more than 2 billion barrels of oil. We have extensive experience in the Berkine Basin, and we intend to move quickly to bring these latest discoveries onto production using our existing infrastructure," Alman added.

In January, Anadarko announced a $98 million capital spending program for 2003 in Algeria, which will focus primarily on exploration and development drilling. In addition to the exploration wells planned on Blocks 404 and 208 during the year, Anadarko expects to drill or participate in 41 development wells. Seismic data that has been reprocessed and acquired over the last two years is currently being interpreted as part of the ongoing development of the prospect inventory.