SPM Spg Media

RNS Number:9114D
Sodra Petroleum AB
17 January 2000


                        SODRA PETROLEUM AB

Sodra Petroleum AB announces that its parent company, Lundin Oil
AB ("Lundin") has today issued the following announcement:-
                                 
Lundin Oil AB and Red Sea Oil Corporation in discussions regarding
                      a business combination
                                 
Lundin  Oil AB ("Lundin Oil") and Red Sea Oil Corporation  ("RSO")
are  pleased to announce that they are in discussions regarding  a
business combination of RSO and Lundin Oil.

The  Board  of  Directors of Lundin Oil and  RSO  have  agreed  to
proceed  in  principle  with a business  combination,  subject  to
mutually agreeable terms, which will most likely involve the offer
to RSO shareholders of newly issued shares in Lundin Oil.

Lundin  Oil currently owns 58% of the outstanding shares  in  RSO.
RSO  has a 60% interest in and is Operator of Area NC177 in Libya,
including  the  undeveloped  En Naga North  and  West  oil  field.
Lundin Oil has a 40% interest in Area NC177.

Lundin  Oil shares are quoted on the Stockholm Stock Exchange  and
the  Nasdaq  market and the RSO shares are quoted on the  Canadian
Venture Exchange.

The transaction would constitute a "related party transaction"  in
accordance   with  applicable  Canadian  securities   legislation.
Accordingly, an independent committee of the Board of Directors of
RSO  has been formed in order to assess the fairness of any  offer
to  those  shareholders other than Lundin Oil and other  insiders.
The committee will appoint an independent third party in order  to
assist  it  in reviewing any potential offer and who will  prepare
appropriate  valuations  on Lundin Oil and  RSO  as  part  of  its
mandate.

RSO  and  Lundin  Oil expect to be in a position to  announce  the
terms of the offer by 29 February 2000.

Mr  Ian  Lundin,  President  of  Lundin  Oil  and  RSO  said  "The
combination  of  RSO  and  Lundin Oil is  a  logical  development,
particularly  as Lundin Oil already owns 58% of RSO.  The  greater
financial capacity of Lundin Oil to raise project financing should
ensure that the En Naga North development can proceed".

             For further information, please contact:
                           Ian H. Lundin
                             President
                       Tel: +41-22-319 66 00
                                 
                           Magnus Nordin
                       Tel: +46-8-440 54 50

                   Simon Rothschild/Judith Parry
                      Millham Communications
                        Tel: 0171 256 5756


Notes for editors:

1.   Lundin is the parent company of Sodra by virtue of its
holding of 40,506,500 Ordinary Shares of SEK0.05 each.  The
40,506,476 Convertible Shares of SEK0.05 each in Sodra listed on
the AIM market are effectively convertible into the right to
subscribe for B Shares in Lundin in November 2001.  Upon exercise
of the conversion right, for every 12 Convertible Shares, the
holder will receive a warrant to subscribe for 1 new Lundin B
Share at the nominal value of SEK0.50.

2.   Convertible Shares in Sodra are also listed on the New Market
of the Stockholm Stock Exchange.  Lundin B Shares are currently
quoted on the Stockholm Stock Exchange, Toronto Stock Exchange and
the Nasdaq National Market.
                                 


END
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