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Meridian Petroleum PLC
04 April 2006

MERIDIAN PETROLEUM PLC
('Meridian' or 'the Company')

VICTORY 1-21 SUCCESSFULLY COMPLETED


Meridian, the oil & gas exploration and production company with key assets in
the USA and Australia today announced that the Victory 1-21 production well (10%
WI) has been successfully deepened in order to further penetrate a Niagaran
reef.

Using a coiled tubing unit and conventional work over rig, Total Depth was
reached at 4,394 feet and gas communication was made between 4,161 feet and
4,192 feet, an increase of approximately 31 feet in net pay. The well was
treated with acid to stimulate flow and is currently being swabbed to remove
remaining acid from the well bore following which the well will be put back on
line this week. It is anticipated that enhanced production rates will be gained
from the additional pay sections in the reservoir.

Anthony Mason, Chief Executive of Meridian said:

'The successful deepening of Victory 1-21 is good news for Meridian. The well
will be back on line this week, following which Meridian will resume receiving
income from Victory 1-21. We are now looking forward to the imminent completion
on Calvin 36.'

Don Caldwell, a certified petroleum geologist, is the Company's Qualified Person
and has reviewed the information in this announcement.


Enquiries:


Meridian Petroleum (020 7409 5041)
Tony Mason, Chief Executive

Westhouse Securities (020 7601 6100)
Richard Morrison

Citigate Dewe Rogerson (020 7638 9571)
Media enquiries: Martin Jackson / George Cazenove
Analyst enquiries: Nina Soon


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

To the best of my knowledge Meridian have never mentioned hedging any of their gas. Their reporting of $32,000+ coming in per day would indicate not.

All I can say is if that well keeps on producing all year with that sort of income, and minor interruptions now and again, the company should declare a profit, although they will probably be drilling Calvin again, which will use up some of the funds.

To be fair the graph is really terrible, but there has to be some upside here, $32000 per day is not chickenfeed, let's suppose the well is offline for 65 days of the year, (I'm just guessing this) : that leaves 300 days times $32000 = $9600000 per year, a fortune for such a small company, (before expenses and tax of course), perhaps I'm missing something here, so please correct me if you wish.

why does there have to be upside? .... market disagrees with you too

There, a slight miscalculation on my behalf here, MRP only own 75% of orion,
so 9600000 divided by 4 multiplied by 3 = $7200000 , I would guess maximum revenue, that's if the well keeps on producing all year, any increase would be a bonus, if I'm anywhere near the correct calculations then this little company is undervalued and in time will be priced up accordingly.

PS. It's a leap year next year so it could be offline for 66 days, cheers!

dont forget they get 75% after their $3.5m is collected first!!!

You should research the rps reports on merideans website so even more money first.

Thanks m12rtn (what a weird name), do you mean MRP get $3.5m or the other company, please can you elaborate, thanks once again.

They have a NRI of 87.5% until CAPEX OF $3,500,000 is
recovered from production and then the NRI will reduce
to 75%.

Hope that helps

Thank you distant solar system m12rtn, this makes it a little bit better.

Anyone here care to give an opinion on today's RNS? I am somewhat ambivalent about it. On the one hand I had hoped that work on Calvin Deep might get underway fairly soon which now seems unlikely, on the other however the asset does appear substantial and having EnSight drop out of the equation could leave Meridian with a much greater stake by which to profit.

Tau Ceti
my view is the same as yours, future returns is inevitable,how long we wait is really down to managment and how fast they make things happen.
i think at the some of the sales showing are actually buys.I believe this stock is currently undervalued,and should be at least 14 / 18p

I think we should start seeing an uphill climb from here, money is coming in from Orion, aussie assets to be sold shortly, less risk , more news to come. I will be buying more as and when funds allow. Valued at under 9 million and producing 30k$ a day, no brainer imo.

Stephen Gutteridge, Chairman of Meridian Petroleum, said:


"The Orion 36 well continues to perform consistently well and we continue to
gain valuable information on reservoir and operational performance. The
allowable production level in our permit supports our view that the well is
potentially capable of producing at over 4mmcfd and reflects confidence in
Meridian and our partners Wellmaster as producers of sour gas. We remain very
aware of our responsibility for safety and the environment and will continue to
invest in improvements to our operations. Since coming on-stream in August 2007
the total gas production from Orion of 300 million cubic feet with a gross value
of well over $2 million is a significant achievement, and one that marks us out
from most other small AIM-listed oil and gas companies."

A strange situation. Here we have a company valued at around £8 million with more than £1 million cash likely in its bank account right now, an asset in Orion that is currently producing almost another £500,000 a month and that asset alone likely to produce another £10 - £15 million in its lifetime. On top of all this it has a whole bunch of other US and Australian 'safe play' assets still to be worked on. So why the low market cap apart from it only having the one asset up and running right now? Anyone have the answer?

not got an answer but maybe one of the reasons. a quick look , shows shares diluted over 3 years at a rate os 10 mill extra every year, assets increase by 300,ooo per year.and as with most aim exploration comps it early days ,which makes mms cautious .if it still had its ipo shares they would be averaging around 25/30p

yes

word is meridian is producing well and the orion field although small it has over 4BCF of gas and NGL recoverable. The company has recently had a change of management leaving tony mason the ex CEO with over 24 million shares in hand
although the market excepts meridian is currently trading at a large discount to fair value his holding requires attention . another problem the company have is that while the market awaits clarification select houses are bombarding and spamming bill boards "advfn , iii " to discourage buying .

onion field = small potato field?

Small potatoes maybe - but that which matters, like the vegetable, is underground and when extracted may "well" be larger than expected

Thanks to everyone for their replies.

Maxtor, do you anticipate any further share dilution considering the income they now get from Orion? To me it doesn't look as though they need to raise any money short term.

W1zzard, do you think the ex CEO will be forced sell part of his holding at these prices? Surely he must know what the true value is here? I see he is after the Australian assets, is that why he might need to sell?