VPC Venture Prod.

RNS Number:1902B
Venture Production PLC
26 July 2004


26 July, 2004

                             VENTURE PRODUCTION plc
                   ("Venture", "the Company" or "the Group")



      Venture Expands SNS Gas Business and Reduces Audrey Production Costs

Venture Production plc ("Venture"), the Aberdeen based UK independent oil and
gas production company, today announces that it has reached agreement with ENI
UK Limited to acquire its 11.11% interest in Block 48/10a located in the
southern North Sea. Block 48/10a contains the Venture operated Annabel discovery
and also includes a unitised interest in the ConocoPhillips led Saturn
development, both major new gas fields currently being brought into production.
Venture will now own 100% of Annabel, and has raised its unitised interest in
Saturn from 19.56% to 22.00%. The total consideration payable will be #3.3
million subject to adjustment to take account of cash flows since the effective
date of 1st January 2004. Completion of the acquisition is subject to regulatory
and other customary approvals and is expected to take place during the third
quarter.

Annabel is due to come on stream in early 2005 and the Company is pleased to
announce that it has successfully completed the 48/10a-12 well as a production
well. The well was hydraulically fractured prior to completion and tested at
rates of approximately 100 million cubic feet per day ("MMcfpd"). The well is
currently suspended awaiting subsea tieback to the Audrey 'B' platform, an
operation that will take place later this year. First production from Saturn is
anticipated in the fourth quarter of 2005.

Total net proven and probable reserves acquired as a result of this latest
acquisition amount to 14.6 billion cubic feet ('Bcf') or 2.4 million barrels of
oil equivalent ("MMboe") and the increased interests in the two fields are, in
aggregate, expected to add net production of approximately 7 MMcfpd from 2005
onwards, compared to expectations prior to the acquisition.

In addition, Venture has reached agreement with the LOGGS pipeline system owners
to amend the transportation and processing arrangements for the Audrey field,
consistent with the new gas sales arrangements entered into in March this year.
Overall, these new arrangements result in processing and transportation tariffs
for incremental volumes of gas production being between 30% and 45% lower than
those applying under the old gas sales arrangements. These new arrangements
provide further commercial incentive for Venture to rejuvenate the Audrey field
and are backdated to take effect from 1 April 2004.

Commenting on the news, Bruce Dingwall, Chief Executive said:

"Increasing our stakes in Annabel and Saturn consolidates our position in these
two core assets. Both this latest acquisition and the new commercial
arrangements for Audrey are consistent with our strategy of focusing on assets
which are not strategic to their former owners but which offer opportunities to
profitably squeeze more gas out of the ground. In addition, this transaction
represents further growth in our gas business at a time when the UK natural gas
market dynamics look highly attractive. The added boost of a reduction in
overall production costs through the reduced tariffs we have negotiated only
serves to enhance the value of our gas assets, which now represent around half
of Venture's business."

                                      ENDS

Contact:

Bruce Dingwall, Chief Executive 01224 619000
Mike Wagstaff, Finance Director
Rod Begbie, Corporate Development Manager

Patrick Handley, Brunswick 020 7404 5959
Eilis Murphy




Notes to Editors:

   * Partners in the Saturn development are ConocoPhillips (U.K.) Limited
     (operator), RWE DEA UK Development Limited, Venture Production (North Sea
     Developments) Limited.
   * Venture entered the southern North Sea ("SNS") in 2001 through the
     acquisition of interests in the Audrey, Ann and Alison gas fields.
   * Venture has built its SNS business through eight acquisitions, five
     major commercial transactions and participation in four wells over the
     period 2001-2004.
   * Venture is the operator and 100% owner of Audrey, Ann, Alison and Amanda
     and, as a result of today's announcement, is now 100% owner and operator of
     Annabel.
   * As a result, Venture now has interests in seven SNS gas fields:
     -  three in production (Audrey, Ann, Alison)
     -  four near term developments on stream in 2005/6 (Annabel, Saturn,
        Mimas and Amanda)
     -  at the end of 2003, total net proved and probable reserves amounted to
        224 Bcf
     -  this existing gas portfolio has the potential to deliver peak
        production of approximately 200 MMcfpd over the next several years.


                      This information is provided by RNS
            The company news service from the London Stock Exchange

END
ACQGGGZNNFRGDZM

Venture Production (LSE:VPC)
Historical Stock Chart
From Jun 2024 to Jul 2024

Venture Production (LSE:VPC)
Historical Stock Chart
From Jul 2023 to Jul 2024