Ramco Begins Production at Seven Heads Gas Field

Ramco Energy announces that the Seven Heads gas field in the Celtic Sea has been successfully brought into production. Production commenced on Saturday, December 13th and the new facilities are now in a short period of commissioning. Following completion of commissioning it is planned that the initial production rates from the five producing wells will be 60 mmscf/d.

The Seven Heads gas field is adjacent to Ireland's largest producing gas field, the Marathon operated Kinsale field. This proximity to existing infrastructure enabled Ramco to develop Seven Heads on a fast-track basis via a sub-sea pipeline tied back to the Kinsale facilities. The Seven Heads development has achieved production in just nine months from development approval.

It is expected that the Seven Heads field will contribute approximately 10-15% of the Irish demand for gas in 2004, displacing imports from the UK. Ramco has agreed to sell its share of the field's gas production to Innogy Ireland Limited, and will receive a price in excess of the UK national balancing point price.

The field's proved and probable reserves have been independently assessed by Exploration Consultants Limited at 390 bcf (Ramco's share: 337 bcf or 59 million boe). Ramco has already acquired interests in several other blocks in the Celtic Sea and is planning a seismic work programme for 2004 to assess the potential for the future development of satellite structures, capable of being tied back to the existing infrastructure.

Ramco also announces that it has further added to its Celtic Sea acreage with the award of Licensing Option 03/10 "East Kinsale".

The Seven Heads partners are Ramco (Operator) 86.5%, Island Petroleum Developments Limited (a subsidiary of DNO ASA) 12.5% and Sunningdale Oils (Ireland) Limited 1.0%.

Daniel F Stover, Ramco's Chief Operating Officer said "The Seven Heads development is important both for Ramco and for Ireland. Bringing the field into production in such a short time frame has been a significant achievement and we are grateful for the hard work of all of those involved in the project. Looking forward, we are already turning our attention to identifying possible satellite opportunities as a part of our strategy to develop a major Celtic Sea gas operation to help meet growing Irish gas demand."

John Browne T.D. Minister of State at the Department of Communication, Marine and Natural Resources said "The coming on stream of this gas field will bring significant benefits to the Irish economy, specifically as another source of indigenous natural gas and the added value that accrues from the downstream use of such gas."

"This first flow of gas also sends out a strong signal to exploration companies around the world that the Irish offshore sector offers opportunities."