Bridge Energy ASA : Operational Update - 07 January 2013

07 Jan 2013

Bridge Energy ASA

("Bridge", "Group" or "the Company")

Operational Update

Bridge, the Oslo Børs and AIM listed oil and gas exploration and production company (OSE: BRIDGE/ AIM: BRDG.L) provides an operational update on progress made to date following a successful 2012 drilling programme.

Strategic progress
The Company has made significant progress during 2012 in each of its key result areas:
• Production capability has grown through acquisition of the Boa  field interest
• Significant value has been created through low cost exploration with positive results and a   75% commercial success rate
• Development assets have been matured providing opportunities for investment and production   growth in the future
• The resource base of the Company has been strengthened with additions in key disciplines
• Successful listing on AIM in September 2012 and transferred from Oslo Axess to Oslo Børs   main list November 2012.

Operational highlights
• High impact exploration programme delivered three commercial oil discoveries from four exploration wells drilled 
• The three discoveries yielded an estimated 75 mmboe recoverable resources (gross)/ 15mmboe  (net to Bridge); with c. $60mm of value delivered through $7.5m of capital spend.
• Oil discovered in the North Sea Contender Well in UK block 211/21; the field was developed   and renamed as the Cormorant East Field.  First oil is expected this month.
• Oil discovered in a high quality reservoir in PL554 Garantiana (operated by Total), estimated between 25 and 75mmbbl of recoverable resources (gross) / between 5 and 15 mmbbl   (net to Bridge).PL457 Asha discovery (operated by Wintershall) with good quality oil in an   excellent reservoir, estimated between 25 and 35 mmboe of recoverable resources (gross) /   between 5 and 7 mmboe (net to Bridge)
• Total estimated increase to contingent (2C) resources in 2012 of approximately 30mmboe net   to Bridge
• Producing assets generating c.1,200 boepd - an increase of 10% from year-end 2011
• Development studies underway for the Vulcan Satellites and Duart East, with infill drilling   opportunities identified at the Boa field

Corporate developments
• Completed the acquisition of the Boa field interest, adding production and further    diversifying revenue base
• Continued to review accretive acquisition opportunities to further leverage existing tax   loss pool
• Acquired two new licences in the 27th UKCS round; with several others pending
• Applications submitted and pending in the NCS 2012 APA round
• Farm-down of PL497 with substantial carry of exploration well cost
• Farm-down of Aragon prospect completed December 2012
• Farm-down of Southern North Sea Vulcan hub assets to be progressed through Q1 2013

Financial strength
• Successful listing on AIM providing access to a wider range of investors and enhancing    liquidity
• Grown cash flow through the Boa acquisition and increased bias to oil production as a result
• Fully funded for the near-term programme from operational cash flow and existing debt    facility
• Financial flexibility through a Reserve Base Loan (£13 million drawn on a £42 million    committed facility) and 400MNOK Norwegian tax facility
• Significant tax pool providing further financial flexibility

2013 plans
• Continue to focus on high impact, low cost exploration
• Three exploration wells expected to be drilled in 2013, including further exploration wells   in areas adjacent to the Garantiana and Asha discoveries
• Progress development options with our existing portfolio of assets
• Production is expected to increase further following first oil from the Cormorant East    field, along with Duart field re-start later in the year
• Continue to review potential accretive acquisition opportunities
• Full year-end 2012 results will be announced on 28th February 2013

Tom Reynolds, CEO of Bridge Energy, commented:
"2012 delivered a step change in our business.  Bridge has significantly grown production, resources and its capability over the past year and starts 2013 with a wider portfolio of growth options to pursue.

"We are proud of the portfolio we have built.  We have added valuable properties through corporate activity and the licensing round and we have added material value to existing assets through the drill bit.  The past 12 months have been extremely successful in delivering high value, commercial discoveries.  The estimated value of the barrels we have added is a multiple of the drilling cost net to Bridge.  We will continue to pursue our established strategic goals in 2013: to deliver high impact exploration efficiently, whilst growing our cash flow from a diverse portfolio of productive assets. We are now focused on unlocking the potential of our assets through a busy exploration and development programme in 2013 for which we are fully funded through our operational cash flows and available debt facilities."

Tom Reynolds, CEO, Alfred Kjemperud, MD Norway and Kevin Purvis, UK Exploration Manager, will be speaking today at Macquarie Oil & Gas Explorer Conference. The presentation slides will be made available on www.bridge-energy.com after the event.

- Ends -

For further information, please contact:

Bridge Energy
Tom Reynolds, Chief Executive
[e-mail]
Aberdeen                                                            [phone]

Cenkos Securities
Jon Fitzpatrick                                                     [phone]
Neil McDonald                                                    [phone]

FTI Consulting
Edward Westropp/Natalia Erikssen/Jess Allum     [phone]
[e-mail]

Statutory guidance statements
This information is subject to disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.

Notes to Editors
Bridge Energy is an oil and gas exploration and production company which holds production licences in the UK (North Sea) Continental Shelf and exploration assets in both the UK and Norwegian Continental Shelves. The company is listed on the Oslo stock exchange (OSE: BRIDGE) and the London stock exchange (AIM: BRDG.L).

The technical information contained in this announcement has been reviewed and approved by Dr Alfred Kjemperud, Managing Director, Bridge Energy Norge AS.  Alfred holds a PhD in Geology from The University of Oslo and has been a practising Petroleum Geologist for over 30 years. He has compiled, read and approved the technical disclosure in this regulatory announcement.

The resource estimates are based on the company's best estimate as of January 2013 and based on the definitions and guidelines set out in the 2007 Petroleum Resources Management System prepared by the Oil and Gas Reserves Committee of the Society of Petroleum Engineers and reviewed and jointly sponsored by the World Petroleum Council (WPC), the American Association of Petroleum Geologists (AAPG) and the Society of Petroleum Evaluation Engineers (SPEE).These definitions and guidelines can be found on the SPE website at www.spe.org.

The technical disclosure in this announcement and the estimates in the CPR are based on the definitions and guidelines set out in the 2007 Petroleum Resources Management System prepared by the Oil and Gas Reserves Committee of the Society of Petroleum Engineers and reviewed and jointly sponsored by the World Petroleum Council (WPC), the American Association of Petroleum Geologists (AAPG) and the Society of Petroleum Evaluation Engineers (SPEE).These definitions and guidelines can be found on the SPE website at www.spe.org.

The Company has a significant number of licences both within the UK and NCS, including several operatorships.  Bridge has drilled 17 exploration and appraisal wells, including ten discoveries.

Underpinned by existing production from its operated Victoria field, non-operated Duart field and non-operated Boa field, Bridge boasts a high impact exploration portfolio with a strong inventory of undeveloped gas discoveries which represents a sustainable business platform for production and exploration growth in the North Sea.

For more information please visit: www.bridge-energy.com