Atlantic Petroleum confirms significant oil discovery at Hook Head, Celtic Sea, Offshore Ireland

Extract from the announcement attached.

Tórshavn, Faroes Islands, 10th October 2007 - Atlantic Petroleum (OMX: FO-ATLA)
the international upstream oil and gas company, together with its Celtic Sea
partners, is pleased to announce the confirmation of a significant oil
accumulation at Hook Head, with good quality oil recovered from target
reservoir zones. Operational issues precluded a full investigation of the
reservoir, however key data was obtained that will aid future planning. The
50/11-3 appraisal well, operated by Providence Resources and spudded on 17th
August 2007, has now been suspended and the rig is being demobilised. 

Atlantic Petroleum, together with its partners, announces that it has now ended
its well testing operations on the 50/11-3 Hook Head appraisal well, offshore
Ireland. The well, which is located in about 240 ft. water depth and is about
60 km offshore southern Ireland, is situated in Standard Exploration Licence
2/07 in the North Celtic Sea Basin. The well was drilled to a total depth of
4,880 feet true vertical depth subsea using the semi-submersible drilling rig
Petrolia, which the operator Providence Resources and partners had contracted
for a 50-day period. 

Some of the key results determined from the drilling programme and the
preliminary evaluation of the initial well data are: 

·The well was drilled on the crest of the structure and was on geological
prognosis confirming the pre-drill interpretation 
·Hydrocarbons were encountered over a 484 feet gross interval in the main
target zone, with 75 feet net hydrocarbon bearing section 
·Three further prospective zones, which were identified pre-drill as
exploration targets for the well, were all logged as being hydrocarbon-bearing.
 These good quality reservoir zones, which are above the main target zone, had
good oil/gas shows whilst drilling and logged a cumulative of about 20 feet of
additional net pay 
·The hydrocarbon type recovered is now confirmed as a good quality (around 30
degree API) crude oil, with associated gas 
·The reservoir is normally pressured to around 1,170 psi at around 2,550 feet
true vertical depth subsea 
·The reservoir porosities within the hydrocarbon bearing zones are up to 27% 

Whilst key reservoir and fluid data were acquired during the initial well
flowing period, down-hole mechanical conditions*, which were primarily related
to the integrity of the casing string cement bond, delayed the implementation
of a full flow test programme. Further work on the down-hole mechanical
conditions was precluded by the time limitations relating to the rig contract.
Accordingly, the partners have now agreed to suspend the well for future
re-entry and potential use as a production well, having gathered all data that
can be reasonably acquired at this time. The rig is currently being
demobilised. 

*A lack of good casing cement bond resulted in poor casing integrity, which
resulted in water ingress from zones above and below the main
hydrocarbon-bearing intervals. Several sequential remedial cement jobs were
carried out which hampered the ability to carry out a full testing programme
within the timeframe available. However, this remedial work has secured the
well for potential future re-use. 

The Hook Head partners have committed to an immediate and detailed evaluation
of the well results, in the context of operations as well as reservoir data,
with a view to further appraisal/ development drilling at Hook Head early in
the 2008 drilling season. Discussions have already commenced regarding the
securing of an appropriate rig. 

Commenting on the announcement, Wilhelm Petersen, Managing Director of P/F
Atlantic Petroleum said: 

“Atlantic Petroleum are very pleased with the results of the well and the
progress made towards confirming the validity of Hook Head as a viable oil
field. It was unfortunate that operational issues precluded a full
investigation of the reservoir, however we obtained key data that will aid
future planning. We look forward to working with Providence and our partners
towards evaluating the data, drilling further wells and investigating the
potential development scenarios for Hook Head, in accordance with our
strategy.” 


Celtic Sea Licence 2/07

Licence No 2/07 refers to part blocks 49/22, 49/23, 48/29, 48/30, 49/26, 49/27,
49/28, 49/8, 49/9, 49/13, 49/14, 50/6, 50/7 and 50/11 in the North Celtic Sea
Basin. Standard Exploration Licence 2/07 partners include, Providence Resources
Plc (Operator) 43.5294%, Challenger Minerals (Celtic Sea) Limited 16.3235%,
Dyas BV 16.3235%, Forest Gate Resources Inc. 7.5%, Atlantic Petroleum (Ireland)
Limited 10.8824%, Sosina Exploration Limited* 5.4412%. 

* Farm in subject to Ministerial Consent


Further Details
Further details can be obtained from Wilhelm Petersen, Managing Director, tel
+298 350 100 (wilhelmp@petroleum.fo) or Teitur Samuelsen, Financial Manager,
tel +298 350 100 (teiturs@petroleum.fo). This announcement will be available,
together with other information about Atlantic Petroleum, on the company's
website: www.petroleum.fo.