Commenting, Addax Petroleum’s president and chief executive officer, Jean Claude Gandur, said:

“Addax Petroleum continues to deliver strong operating cash flows and healthy netbacks despite a significantly lower oil price environment. As part of the Corporation’s ongoing commitment to maintain liquidity and to operate under a balanced budget approach, certain development activities were postponed in order to maintain a concerted focus on exploration.

The stage has been set for our high impact projects to make for an exciting year. We are extremely pleased to have recently received a confirmation from the Kurdistan Regional Government that crude oil exports will commence from the Taq Taq field. In addition, with the recently contracted Deepwater Pathfinder drillship, the Corporation has entered a new and significant phase of exploration in the highly prospective Deepwater Gulf of Guinea. While the original schedule had us commencing drilling in the JDZ Block 4 in the fourth quarter, we understand that the drillship may now arrive earlier in the second half of 2009.”

Average gross working interest oil production in the first quarter of 2009 was 134,730 bbl/d, representing a decrease of approximately 3% over the first quarter of 2008 average production of 139,100 bbl/d.


average oil production from Nigeria in the first quarter of 2009 was 103,930 bbl/d and in line with expectations, compared to a the first quarter of 2008 average production level of 109,700 bbl/d;

lower production in the first quarter of 2009 was primarily attributed to contractor delays in the start-up of new wells and a gas constraint in gas-lift, both in the OML123 licence area, and a scheduled shutdown of the Sendje Berge FPSO for a statutory inspection in the OML126 licence area.


average oil production from Gabon in the first quarter of 2009 was 27,960 bbl/d and in line with expectations, compared to a the first quarter of 2008 average production level of 29,400 bbl/d;

production in the first quarter of 2009 was impacted from the start-up of the new Obangue production facility and wells awaiting gas-lift installation.


Addax Petroleum’s entitlement to crude oil production from the Taq Taq field in the Kurdistan Region of Iraq commenced in the first quarter of 2009 at an average rate of 2,850 bbl/d;

petroleum activities for Taq Taq remain in the pre-production or development stage for accounting purposes, and as such, all revenues are currently being recorded as a reduction to capitalized expenditures.

Development project highlights in the first quarter of 2009 include:


drilled four new development wells which included two oil production wells and one water injection well in OML123 and one oil production well in OML126;

placed a total of two new oil production wells on production in the quarter, being the two wells drilled in OML123 in the quarter; and,

installed and tested the Adanga North B platform topsides in OML123 offshore Nigeria.


drilled three new development wells onshore in the Addax Petroleum operated Obangue field in the Panthere NZE licence area and a further two development wells in the third party operated Ebouri field in the Etame Marin licence area;

placed three new oil production wells on production in the quarter, being two wells in the Obangue field and one well in the Ebouri field;

completed the new onshore Obangue East Central Processing Facility that will handle the planned increase in production and associated fluids from the Obangue field during the ongoing field development; and,

continued development of the Koula field by the operator of the Awoun licence area for a planned production start-up in the fourth quarter of 2009.


commenced sustained crude oil production and sales to the domestic market from the Taq Taq field;

submitted a full field development plan for the Taq Taq field to the Kurdistan Regional Government; and,

continued expansion of the on-site processing facilities to increase capacity up to 70 Mbbl/d in late 2009.

Operating netbacks in the first quarter of 2009 decreased 60 per cent to $29.35/bbl compared to $72.49/bbl in the first quarter of 2008. Unit operating expenses in Q1 2009 increased to $8.47/bbl, an increase of 5 per cent over the 2008 level of $8.09/bbl primarily due to additional downhole maintenance and personnel related costs in relation to the growing operations in Gabon and increased security costs for ocean marine vessels in Nigeria.

Selected Exploration and Appraisal Highlights

Exploration and appraisal highlights to date in 2009 include:

Kurdistan Region of Iraq

completed testing on the TT-10 appraisal well that was drilled into the crest of the Cretaceous formations in the Taq Taq field where it encountered a gross oil column of 530 metres. The TT-10 well successfully flow-tested three reservoirs with an aggregate rate of 44,240 bbl/d of light oil, measured gravity of 48° API with low gas oil ratio; and,

commenced the exploration drilling of the Kewa Chirmila prospect in the Taq Taq licence area where the well is expected to reach total depth by mid-2009.

Gulf of Guinea Deep Water (Nigeria and JDZ)

announced that the Corporation signed an agreement with a subsidiary of Transocean Ltd. for the provision and operation of the Deepwater Pathfinder drillship to commence its exploration drilling campaign in the Deepwater Gulf of Guinea. Addax Petroleum expects to receive delivery of the Deepwater Pathfinder in the second half of 2009 in order to commence the drilling of four consecutive wells.

Gulf of Guinea Shallow Water (Nigeria and Cameroon)

notified intention to enter the next two-year exploration period in the Ngosso licence area offshore Cameroon, subject to government approval, which includes the commitment to drill one exploration well by January 2011.


drilled an appraisal well at the Autour field in the Panthere licence area onshore Gabon, the results of which are currently being evaluated;

commenced the exploration program in the Gryphon Marin licence area offshore Gabon with the drilling of the Corporation’s first wells. The Ajomba South and Ajomba Main wells were plugged and abandoned as dry holes, however, the results and technical data acquired from the well will be used in the additional seismic and exploration drilling that is planned for the license area; and,

participated in the drilling of the North Etame exploration well in the Corporation’s Etame Marin license area offshore Gabon. The third party operated well encountered lower than anticipated hydrocarbons, was water bearing and was plugged and abandoned.

Dividend Declaration

The Board of Directors of the Corporation declared a dividend of CAD0.10 per share on May 12, 2009 which is payable on June 18, 2009 to shareholders of record on June 4, 2009. During the first quarter of 2009, the Corporation declared a dividend of CAD0.10 per share.

Recent Developments

In May 2009, the Corporation received formal notification from the Kurdistan Regional Government that international exports of crude oil from the Taq Taq licence area will commence on or soon after June 1, 2009.

In April 2009, the Corporation completed drilling one exploration well at the Okwori East prospect in the OML126 licence area offshore Nigeria where the well was plugged and abandoned as a dry hole.