Venture Confirms Cygnus as Major Undeveloped Gas Field in North Sea

Venture has successfully tested well 44/12a-3 to appraise the Cygnus gas field. Venture has a 48.75% interest in the field. The Cygnus field lies within UKCS blocks 44/12a and 44/11a near to the Caister Murdoch System (CMS) area in the southern North Sea (SNS) and is operated by GDF Suez.

The appraisal well was drilled by the Noble Ronald Hoope jackup drilling rig and had three primary objectives: to prove the presence of the Leman reservoir in the eastern part of the field, to assess reservoir quality and fluid content of the primary Leman reservoir and to test the deeper Carboniferous reservoir as a secondary target. The well tested the Carboniferous reservoir at equipment constrained flow rates of 32 million standard cubic feet per day (MMscfpd) gross. A well test was also performed on the Leman reservoir which flowed at low rates in line with pre-drill expectations.

The well has successfully confirmed the presence of gas in both the primary Leman and secondary Carboniferous reservoir intervals, and encountered a gas water contact consistent with Fault Block 1 thereby confirming pre-drill estimates of gas in place volumes. The quality of the Leman reservoir was as per pre-drill expectations while the Carboniferous reservoir interval substantially exceeded expectations.

The likely gross incremental reserves in the Carboniferous section of this fault block are expected to be in excess of 100 billion cubic feet (Bcf) (16.6 million barrels of oil equivalent (MMboe)). A further appraisal well to test another fault block in the north eastern part of the field is due to be drilled immediately following completion of this well.

A field development plan for the first phase of the field is currently in preparation with sanction expected in 2009 and first gas in late 2010 or 2011. Subsequent development of the field will depend on the results of the second appraisal well and field performance.

Commenting on the news, Mike Wagstaff, Chief Executive said, "We are delighted with the success of this appraisal well which has gone a step further toward confirming our belief that the Cygnus field is one of the southern North Sea's largest undeveloped gas fields. With up to five fault blocks with development potential we believe that Cygnus will be a core asset for Venture for many years. After acquiring our interests in the field last year, this result is testament to the strength of Venture's business model and ability to acquire and rapidly exploit 'stranded' reservoirs such as Cygnus. In 2009 we have a very active drilling campaign especially in the southern North Sea and this is a great start to what should be an exciting year."

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