Dana Petroleum Receives Project Sanction for Medway, Off Netherlands

Dana is delighted to announce that the Medway integrated oil and gas development, operated by Dana Petroleum Netherlands, has received project sanction.

First production from Medway is expected in Q4 2011. The project is initially expected to add an average of 4,100 barrels of oil equivalent per day net to Dana in 2012, with production rising further in 2013 and field life continuing through to 2020. The development of Medway will also significantly benefit Dana by extending the producing life of the De Ruyter oil and gas fields complex, where Dana holds a 54% interest, thereby adding further production and reserves in this area.

The Medway opportunity formed part of the upside identified by Dana during its acquisition of Petro Canada Netherlands BV earlier this year. Medway is now one of three significant oil and gas developments in Dana’s core North Sea area offering near-term production upside, the others being the Western Isles oil fields and the Arran gas fields, both in the UK sector.

Dana is driving forward the Medway development as operator and holds a 50% interest in the project, with the remaining interest held by Dana’s partner EBN. The Medway development is in line with Dana’s strategy of expanding its base of operatorships in its core areas, such as the North Sea.

The Medway project will develop and bring on-stream two discoveries, made during 2007 and 2008, in the greater De Ruyter Area which Dana already operates. The Van Nes gas discovery is situated approximately 8 km north of the De Ruyter platform and the Van Ghent oil and gas discovery lies approximately 4.5 km east of the De Ruyter platform. This area is situated in Block P11b, offshore in the Dutch continental shelf.

The Medway fields (Van Nes and Van Ghent) will be developed via two subsea wells tied-back via dedicated flow lines to the existing De Ruyter platform. The platform will be modified to receive the new oil and gas production by installation of subsea controls, facilities and modifications to the gas export compression system.In addition, the facilities are designed to accommodate the tie-in of future exploration prospects in the area, thus providing further development potential.

Field reserves from the combined Medway development (Van Nes and Van Ghent) are 11.8 million barrels of oil equivalent in the base case development, with additional reserves upside already identified.

Commenting on the news, Tom Cross, Dana’s Chief Executive said:

“Dana’s experienced operational team in the Netherlands has achieved acceleration of the Medway project and plans are well advanced to deliver first production in the fourth quarter of 2011. The Medway development has been carefully designed to allow further oil and gas to be produced through the De Ruyter/Medway offshore facilities as additional targets are drilled in this area.”

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Source: Danapetroleum,September 23, 2010,