Don Southwest On Track for 1Q Full Commissioning

The side-track of the Area 22 production well on Don Southwest (Valiant, 40.0%) has encountered operational difficulties retrieving the down-hole completion and as a result, remedial work has been ongoing for the past few weeks to free a long section of stuck tubing. This has proved significantly challenging exacerbated by weather delays as well as the depth and inclination of the well. However, drilling operations are now ready to recommence after approximately four weeks of delays and it is anticipated that the well will be fully completed by the end of February. Water Injection will commence on Don Southwest following the completion of drilling operations and gas lift should also be commissioned shortly thereafter.

Completion of the Area 22 side-track now coincides with the planned shutdown on both Don Southwest and West Don (together the "Don Fields") for the tie-in to the pipeline export route via the nearby Thistle platform, somewhat mitigating the impact of the operational delay. Valiant will now provide detailed production guidance after the Don Southwest development Phase I is fully commissioned towards the end of 1Q 2010.

Production from Don Southwest has to date only been from a single well in Area 5 which has produced in-line with expectations whilst on West Don (Valiant, 17.275%) production continues in-line with revised profiles that are now benefiting from the impact of water injection and gas lift.

The Don Fields Phase II development is also on schedule for completion in 2010 with the Transocean John Shaw semisubmersible drilling unit contracted for 180 firm plus 90 option days from the end of Q1 2010. Details of the work program are still being finalized, but are expected to include the development of the Horst/Area 6 compartments in Don Southwest through a producer and injector pair which are anticipated to be commissioned and brought on-stream during the second half of 2010. The partners also intend to drill up to two further appraisal wells into other neighboring 'compartments' in the field, including a follow-up appraisal well in Area A/B designed to test a thicker Brent sequence away from the original discovery well drilled in 2007.

The Company also anticipates securing a rig slot for a third production well into the southern area of West Don, which could be brought on stream in late 2010.



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