Afren Pays $588m for Kurdish Oilfields

Afren has announced the acquisition of interests in two contiguous Production Sharing Contracts (“PSCs”) located in the Kurdistan region of Iraq. The Company has agreed to acquire an operated 60 per cent. participating interest in the Barda Rash PSC from Komet Group S.A. (“Komet”) and a non-operated 20 per cent. participating interest in the Ain Sifni PSC from the Kurdistan Regional Government (“KRG”).

Highlights

The Board of Afren believes that the Acquisition represents a highly complementary extension of the Company’s existing portfolio, and offers a combination of near term development upside, substantial low risk exploration potential and a strategic entry into the Kurdistan region of Iraq. In particular:

The Acquisition delivers independently certified 890 mmbbls net 2C resources and total net un-risked resources of 1,074 mmbbls

Total acquisition cost of approximately US$588.25 million (US$0.66 per 2C bbl) inclusive of approximately US$81.0 million back costs and US$14 million 2011 capex related to Ain Sifni

A clear forward plan to develop Barda Rash and appraise Ain Sifni

Progressive short term conversion of 2C resources into 2P reserves

Phased development initially focusing on light oil reservoirs expected to deliver 75,000 bopd net to Afren within 5 years from Barda Rash alone

§ Phase 1: 15,000 bopd (gross) by end 2012

§ Phase 2: 35,000 bopd (gross) by end 2013

§ Phase 3: 125,000 bopd (gross) by end 2017

Delivers low risk exploration upside to portfolio – 183 mmbbls net best estimate prospective resources

Active E&A drilling campaign 2011 – 2012

Complementary to Afren’s core strengths developed in Nigeria

Geologically de-risked

Fast track development solution

Low risk E&A upside

Afren strategically advantaged through historic relationships

Early mover advantage

Positive political trends should eliminate valuation discount

Team on the ground and in place to deliver work programme

Reinforced in-house technical capability to successfully develop fractured carbonate reservoirs

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