Atlantic Petroleum P/F - Company Announcement

Atlantic Petroleum announces Spaniards/Gamma Amalgamation Agreement and firm well commitment.

Tórshavn, Faroe Islands, 2011-06-30 15:01 CEST (GLOBE NEWSWIRE) -- P/F Atlantic
Petroleum (OMX: FO-ATLA) announces that an Agreement has been reached to
amalgamate Block 15/21g and part of Block 15/21a and have committed to drill a
well on the Spaniards prospect. 



The Perth Licence co-venturers in Block 15/21a, DEO Petroleum UK Limited, Faroe
Petroleum UK Limited, Maersk Oil UK Limited and Atlantic Petroleum UK Limited
(together the “Perth Group”) are pleased to announce that they have reached
commercial agreement with the Block 15/21g co-venturers, EnCore Oil plc,  
Nautical Petroleum plc and Serica Energy (UK) Limited (together the “15/21g
Group”), on the amalgamation of a sub area of 15/21a with Block 15/21g to
create a single conjoined area (the “Amalgamated Area”). 



Under the terms of the agreement the parties, subject to the necessary DECC
consent and the formulation of a detailed legal agreement, respective equities
in the newly Amalgamated Area are shown in the attached table. 



The parties have also confirmed a firm well commitment to DECC on the Spaniards
prospect to assess whether it is a continuation of the updip Gamma discovery
which flowed at 2,660 bopd from the Upper Jurassic Galley sands. The Spaniards
well is expected to be drilled in the second half of 2012 and will satisfy the
licence and fallow commitments. The Spaniards well is to be funded 100% by the
15/21g Group on a dry hole basis. It is agreed that the costs of any second
well will be borne 42.8% by the Perth Group and 57.2% by the 15/21g Group again
on a dry hole basis. 



Ben Arabo, CEO, commented:

“We are pleased to be able to add the Spaniards well  as a firm activity on our
future drilling programme. The Spaniards well, operated by EnCore, presents an
interesting opportunity to appraise the 15/21a-38Z Gamma discovery and success
would have positive implications for the development of assets in the Perth
area. We look forward to be working with EnCore, Nautical and Serica going
forward. The Atlantic Petroleum 2011 to 2012 exploration and appraisal well
programme now contains four firm exploration and appraisal wells, which takes
us one step closer to our goal of participating in at least ten exploration and
appraisal wells by the end of 2013.” 



Further Details:

Further details can be obtained from Ben Arabo, CEO, tel +298 350100
(ben.arabo@petroleum.fo). This announcement will be available, together with
other information about Atlantic Petroleum, on the Company's website:
www.petroleum.fo. 

On the website, it is also possible to sign up for the Company's e-mail
newsletter. 



Announcement no. 27/2011

Issued 30-06-2011




         P/F Atlantic Petroleum
         Gongin 9
         P.O. Box 1228
         FO-110 Tórshavn
         Faroe Islands
         Telephone +298 350 100
         Fax +298 350 101
         Website: www.petroleum.fo
         E-mail: petroleum@petroleum.fo

Attachments:

27-2011 Spaniards Gamma Amalgamation Agreement and firm well commitment.pdf