oilbarrel.com 20/07/2004

Paladin Makes It Three-Out-Of-Three In Tunisia With Dalia-1 Oil Strike
Think of Paladin and you tend to think low-cost satellite tie-ins in the North Sea. But in recent years the company has also quietly built up a position in Tunisia where new discoveries can be hooked up and put into production in a matter of weeks.

The companys latest success in the North Africa country came last week when it announced the test results from the Eni-operated Dalia-1 exploration well in the Adam Concession, southern Tunisia. The partners in the project, should Tunisian state oil firm Etap decide to participate, include Paladin (7 per cent), Etap (30 per cent), Eni (operator, 35 per cent) and Pioneer Natural Resources (28 per cent).

The well, the partners third successive discovery in the country, flowed at 3,600 barrels of per day (bpd) of 44-degree API oil during testing. Dalia-1 encountered several oil and gas bearing zones throughout the Acacus A and Tannezuft sandstones at a depth of 3,400 metres.

The well has now been completed and suspended as a producer pending approval of the field development plan and hook up to existing processing and export facilities some 13 km away at Enis Oued Zar oilfield. The Dalia deposit could be onstream within a matter of weeks, Paladin said in a statement.

Chief executive Roy Franklin also pointed out that the partners are in ongoing negotiations to allow commercial gas production to start flowing from the concession later this year.

The previous exploration well on the concession, Hawa-1, which was discovered at the end of 2003 and in production three months later in March 2004, produced significant quantities of gas during testing. The well, which is now pumping some 5,000 bpd, flowed 14.3 million cubic of gas per day plus 1,000 bpd of condensates during testing in addition to the 6,200 bpd of oil.

The partners first well on the concession, Adam-1, was discovered in September 2002 and is today pumping some 4,000 bpd.

The latest exploration success in Tunisia follows on from Paladins first operated exploration well in the UK sector of the North Sea, which last month came in as an oil discovery. Well 22/23a-7 on the Brechin prospect, some 3.5 km to the east of Paladins Arkwright field, encountered 110 ft of oil-bearing sands in the Palaeocene Forties formation. The well was suspended as a potential future producer and the British oil firm hopes to fast-track its development and tie the new oil pool into the Arkwright infrastructure. Franklin said last month that the incremental production stream through the companys existing facilities would result in high value barrels.

Sue Helen

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http://www.paladinresources.plc.uk/uploads/50031.pdf

Record results:
- Cash flow from operations increased 20 per cent to 171.9 million (2003: 143.1 million)
- Pre-tax profit increased 29 per cent to 109.7 million (2003: 84.8 million)
- Profit after tax increased 26 per cent to 35.8 million (2003: 28.4 million)
- Earnings per share increased 24 per cent to 11.06 pence (2003: 8.92 pence)
- Proposed final dividend of 1.14 pence per share to give a total for the year of 1.7 pence per share
(2003: 1.575 pence per share), an increase of 8 per cent