Tunisia: New Dougga Discovery Mapping Shows Strong Increase in Resource Potential

ADX Energy Ltd  announces a significant increase in the resource potential at its Dougga Gas Condensate discovery offshore Tunisia, based on the results of ADX remapping using its leading edge dual sensor 3D seismic data acquired earlier in 2010.

ADX holds a 60% interest and is operator of Dougga and the surrounding Kerkouane permit.

Highlights

• Increase of in‐place gas and condensate volume estimates across all confidence categories – 42% for P(90), 26% for P(50) and 11% for the P(10) estimate

• Inferred revised mean recoverable Contingent Resource of 234 bcf Sales Gas and 50 mmbbls of condensate and LPGs (89 million barrels of oil equivalent)

• 3D seismic mapping indicates 300 meters of updip potential from Dougga 1 discovery well which is interpreted to have intersected a 200+ metre column of gas and condensate.

These results are an important first step in the ongoing technical and commercial assessment of the Dougga discovery that will incorporate an independent resource assessment, an independent review of development  options and associated costs and an economic assessment. The objective of the studies is to establish the technical and commercial feasibility of the Dougga discovery after incorporating the results of an appraisal well planned for 2011. A detailed development review and resource assessment study has been initiated with AGR ‐ Tracs International Consultancy Ltd (“Tracs”).

Summary of the 3D seismic mapping results A key input parameter for resource calculations of the discovery is the Gross Rock Volume “GRV” – being the volume of hydrocarbon bearing reservoir in the structure. GRV is a direct output from the mapping of the 3D seismic. The new GRV has been combined with all the other parameters used in the Tracs 2009 Competent Person’s report on Dougga for calculating in place raw gas volumes.

The new mapping of the Dougga discovery is particularly encouraging because of the potential 42% increase in the “high confidence” P(90) contingent resources case. This upgrade is largely due to a significant improvement in structural and stratigraphic definition utilising the 3D data set.

Increased confidence in resource potential and reservoir quality In addition to the substantial potential increase to the “high confidence” P90 contingent resource case as a result of the 3D seismic mapping, the seismic has also revealed the potential for a thicker high quality Abiod reservoir further updip  from the Dougga 1 well intersection. As a result a location approximately 300 meters updip from Dougga 1 will provide an excellent candidate for a future Dougga well.

The 3D seismic interpretation also indicates that Dougga is likely to contain a highly fractured Abiod reservoir analogous to that encountered at Lambouka. The interpreted fracturing and additional Abiod section based on ADX 3D seismic mapping enhances the potential for good reservoir productivity which in turn is important for the commerciality of Dougga. Demonstrating commercial gas and condensate flow rates via well test will be a key objective of the next well on the Dougga structure.

Additional Dougga prefeasibility study results will be provided as they become available.

The following Joint Venture is participating in the Kerkouane permit,

ADX 60% Operator

Gulfsands Petroleum Plc 30%

XState Resources Ltd* 10%

*XState has an option with ADX to increase XStates interest in Dougga to 20% under agreed farmin terms. If exercised ADX interest would decrease to 50%

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Source: ADX Energy Limited, November 4, 2010;