Forest Oil Completes 3rd Well Offshore South Africa Forest Oil 12

Forest Oil Completes 3rd Well Offshore South Africa
Forest Oil 12/22/2003
Forest Oil has completed the third well in its four to six well drilling program offshore South Africa.

The third well, located 40 km from the well locations drilled in 2001, encountered 11.4 meters (36 feet) of gas pay and was tested at 31 MMcfe/d with a flowing tubing pressure of approximately 2,400 PSI. The second well, located 8 km from the third well, encountered 4.9 meters (15 feet) of gas pay but was not tested. The second and third wells were drilled for approximately $4 million and $3 million, respectively.

These amounts represent an average decrease in drilling costs of approximately 50% per well compared with the 2001 drilling program. The rig will next move 4 km away to drill a delineation well to this discovery. Forest, as operator, holds a 53% working interest in the project, PetroSA has a 24% working interest and Anschutz has a 23% working interest. Forest has a full carried interest in this $30 million program.

As a result of its exploration programs in 2001 and 2003, Forest has successfully discovered natural gas in 5 out of 7 wells that have total combined test rates of 221 MMcfe/d, including the initial discovery well A-K1. Forest has not yet booked any proved reserves associated with its South African holdings.