Faroe Petroleum provide operational update

Tuesday, Feb 26, 2013

Faroe Petroleum, the independent oil and gas company focussing principally on exploration, appraisal and production opportunities in the Atlantic margin, the North Sea and Norway, is pleased to provide an operational update.

Full year production was within the range of management expectation but was impacted by unscheduled down time on the Njord, Brage and Blane fields in Q4. On the Njord field re-instatement of production following a planned shutdown was delayed by an accident involving the third party mobile accommodation unit, the Floatel Superior. The Blane field was also down for nearly ten weeks in late 2012, whilst repairs were undertaken after a gas leak had been detected on the Ula platform to which it ties back. Production was temporarily impacted on Brage due to gas processing and export limitations.

All fields are now back on production and first oil from the Hyme field is expected in Q1 2013. The combined Group production from our five principal fields (Brage, Ringhorne East, Njord, Blane, Schooner) and the new additions (Hyme and East Foinaven) is expected to average between 7,000 and 9,000 boepd in 2013.

“We are pleased to provide an update on current operations and a look forward to our continuing active exploration programme for 2013. Production in 2012 has been in line with expectations and has funded both our exploration programme and a significant proportion of our development capex. Aside from our production cash flow, we have robust cash balances and a substantially undrawn debt facility. We expect higher average production rates in 2013, and, as in 2012, we expect that the cash flow from production will fully fund the exploration programme and a large part of the development capex, with the remainder being funded from reserves and our debt facility, as appropriate.

We drilled six exploration wells during 2012 and the pace of our exploration programme has continued into 2013 with a further five exploration wells planned for 2013 as well as five development wells. The Company is in an excellent position to maintain its momentum in exploration and to make further investments as we execute our growth strategy through the drill bit.”

Source: Faroe Petroleum

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