Placing

16 Dec 2005 12:09

Afren PLC16 December 2005 Immediate Release16 December 2005 AFREN PLC Placing of 24,444,441 New Ordinary Shares to raise £11.0 million, to fund new offshore development opportunities in Nigeria Afren PLC ("Afren" or "the Company"), the Africa-focused independent oil and gascompany, today announces that its brokers, Bridgewell Securities Limited andJefferies International Limited, have placed 24,444,441 new ordinary shares witha range of institutional investors. The new shares ("the Placing Shares") wereplaced at a price of 45p per share, raising £11.0 million (before expenses) forthe Company ("the Placing"). Application has been made to AIM for the PlacingShares to be admitted to trading, which is expected to commence on 22 December2005. The Placing follows the securing by Afren of two new offshore developmentopportunities in Nigeria. The first, the Ogedeh field, was announced in August2005. The Ogedeh field was discovered by Chevron in 1993. Although nevercommercially developed, the analysis so far conducted suggests that the fieldholds between 10 and 25 million barrels of oil, with gas reserves in the orderof 25BCF. The second development opportunity is the Akepo field, offshore Nigeria andadjacent to the Ogedeh field, which was announced by Afren on 8 December 2005.The Akepo field was also discovered by Chevron in 1993 and has also not yet beencommercially developed. It is expected to contain approximately 10 - 20 millionbarrels of prospective recoverable oil resources. The proceeds of the Placing will secure a Letter of Intent for a jack-up rigcontract for the purpose of drilling two appraisal wells on the Ogedeh and Akepodiscoveries. The Company is currently in advanced stages of negotiations tosecure a rig for these wells. It is expected that drilling will commence in Q22006 and that both wells will be suspended after drilling and will be re-enteredfor tie-back as producing wells in 2007. The locations of both fields, inshallow water offshore Niger Delta, mean that the costs of development arelikely to be comparatively low. Analysis already conducted on both fieldsindicates that they could together produce 10,000 barrels per day, on full fielddevelopment. Commenting on the placement of shares, Brian O'Cathain, Chief Executive of Afrensaid, "We are pleased with the positive response to the placement and thecontinuing support of our shareholders. The proceeds will ensure that thesewells can be drilled in the first half of 2006 and that the fields can movetowards first oil in early 2007." 16 December 2005 Enquiries: AfrenBrian O'Cathain Chief Executive +44 20 7182 1800Osman Shahenshah Chief Financial Officer +44 20 7182 1800 Pelham Public RelationsJames Henderson james.henderson@pelhampr.com +44 020 7743 6673 Afren is an independent oil and gas exploration, development and productioncompany, established in 2004 to build an attractive, diversified and balancedportfolio of African assets, with an initial focus on the Gulf of Guinea region.Afren's corporate objective is, "Capital appreciation for shareholders throughpreferential access to oil and gas production and exploration acreageacquisition, production growth, deal flow and exploration drilling in Africa". This information is provided by RNS The company news service from the London Stock Exchange