Don Southwest Pumps First Oil in UK North Sea

Petrofac has announced the commencement of production from the Don Southwest (Don SW) field in the UK North Sea. Petrofac Energy Developments is Operator of the field with a 60% interest, alongside Valiant Petroleum which has a 40% interest.

Production from the field has commenced from two production wells and follows first oil from the West Don field on April 28. The first tanker shipment of approximately 472,000 barrels of oil from the West Don field has been delivered to a terminal in Rotterdam. The second production well and the injection well on West Don are expected to be brought on stream in the early part of the second half of 2009, with the injection wells on Don SW following in the latter part of year.

The production wells will be supported by water injection wells currently being drilled using the Transocean John Shaw semisubmersible drilling unit

A second phase of the Don SW development is currently in the advanced stages of planning, with a further producer/injector pair planned to be drilled and brought on-stream during the second half of 2010.

During the drilling of the Area 22 injection well, the wellbore was sidetracked to an adjacent fault block, Area H, directly south of the Don SW field, to investigate the northern part of the block at low incremental cost. The sidetracked well revealed a 60 feet oil column in the Brent formation. The structure and lateral extent is currently being interpreted.

Amjad Bseisu, Chief Executive of Petrofac Energy Developments commented, "The commencement of production from Don SW represents another major milestone in the development of the Don area. We are now firming up our plans for a 2010 campaign for optimising Area 5/6 development and the early indications of our success in Area H gives us confidence in the prospectivity of the surrounding Areas."

Peter Buchanan, Valiant's CEO, commented, "We are very pleased to achieve first oil production from the Don Southwest field and look forward to completing this phase of the Don project in the near future. Our strategy for the Don fields is to grow production through future stages of exploration, appraisal and development drilling and our success in finding oil in Area H provides confidence in this strategy. We are excited about next year's development options that are currently being defined and we take great confidence in our ability to grow this core area."