2009-08-04-2009-07-01

To exchange North Sea assets, with Faroe acquiring 9.3% in Glitne oil field, 1.86% share in Enoch Field, producing 800 BO/d net; Dong acquiring Trym undeveloped gas field.

Faroe Petroleum Plc (London: FPM) plans to swap an interest in the North Sea Trym development with Dong E&P Norge AS for a combination of £4 million (US$6.6 million) in cash and interests in the producing Glitne and Enoch oil fields. Under the terms of this transaction, Faroe will exchange its 10% interest in the Trym development for up to £4 million in cash of which £2 million is payable at completion and up to an additional £2 million payable upon production targets being met, as well as a 9.3% share in the producing Glitne oil field and a 1.86% share in the producing Enoch Field. Dong Energy will also retain the abandonment liability for the Glitne field, capped at £8.5 million. The Trym development is an undeveloped gas field close to the Norwegian-Danish border with approval of a field-development plan pending. Acquired assets include Glitne Field, which produces some 7,000 barrels of oil per day, with 650 barrels net to Faroe. Enoch oil field is on the U.K./Norway median line and produces 8,000 barrels per day, with 150 barrels net to Faroe. Graham Stewart, Faroe chief executive, says, "We are very pleased with this transaction, which provides cash and oil production revenues in Norway, freeing up Faroe's equity reserves and significantly undrawn debt facility for other purposes."