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Tue 17 Apr 2007 04:35 PM

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Aabar subsidiary enters African market

Abu Dhabi firm's AED 85m drilling contract is part of wider expansion plans.

Aabar Petroleum has announced its wholly owned subsidiary Dalma Energy has won a drilling contract in Algeria, marking the firm's entry into Africa.

The one-year contract, which was awarded by Repsol YPF, is valued at AED 85 million and includes the option of a six-month extension valued at an additional AED 43 million.

"North Africa is a major hydrocarbon province presenting good opportunities for companies such as Aabar," said David Woodward, managing director and CEO of Aabar.

"In Algeria and neighbouring Libya, there is strong demand for development drilling in existing and newly discovered fields, so we see good potential for growth in Africa. We are also evaluating opportunities to develop a presence on the continent for our exploration and production activities."

Under the terms of the contract, drilling operations are expected to commence in June 2007 with the deployment of two deep drilling land rigs. The rigs have a capacity of 2 000 horse power and were built in China at an estimated cost of AED 80.74 million each.

"The two rigs are currently in transit," said George Schneider, CEO of Dalma Energy. "The first unit will arrive in Algeria in early May while the second is scheduled for delivery at the beginning of June 2007. Both rigs will be transported from the Mediterranean coast to the south of the country."

With this contract, the number of new rigs commissioned by Dalma energy this year goes up to four, taking the company's total rig count to 22.

"Global expansion for us means growth around our Middle East base into areas with long-term potential," added Woodward. "Establishing an operation in Algeria is in line with this strategy and will allow us to expand our presence into a major oil and gas province."

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