Reserves increase by 30% at Tui Oil Project

Reserves increase by 30% at AWE’s Tui Area Oil Project

AWE, as Operator of the Tui Area Oil Project, has undertaken a reserve review which has resulted in an increased estimate of oil reserves at Tui by 30% to 41.7 million barrels. This compares with reserves of 27.9 million barrels on which the Tui Area Oil Project was originally developed and an interim estimate of 32 million barrels, following the completion of the development drilling campaign.

The increase in proved and probable (2P) reserves is based on interpretation of re-processed 3D seismic, a more detailed assessment of the Kapuni reservoir and the integration of the production data from the fields since production began on July 30, 2007. The increased reserves assume production from the existing four wells, plus the completion of an additional development well in the Tui oil field, Tui-4H. Preliminary planning for the drilling of this well has begun.

Oil Production Rates

Since the start of production on July 30, 2007, the Tui Area Oil Project has produced approximately 4.4 million barrels of oil.

Recent production rates of up to 50,000 barrels a day have been achieved, with the current well capacity still substantially higher than the processing capacity of the FPSO Umuroa.

Water is being produced from the field, but at substantially lower rates than expected from earlier field simulations.

Based on the current reservoir and facility performance and this upgrade in 2P oil reserves, AWE has revised the Tui gross oil production target for the year to June 2008 from 10 million barrels to approximately 11 million barrels.

AWE’s managing director Mr Bruce Wood said:

“The increase in 2P oil reserves is a great outcome for the Tui Joint venture. “To have increased the reserves by almost 50 per cent since the start of production is an outstanding achievement. “The Tui Area Oil Project will deliver strong returns for AWE shareholders for the long term.”

ENDS

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