Novus Petroleum Ltd increases gas sales from E. Java Wunut field

Novus is pleased to announce that sales of gas from its Wunut gas field in the Brantas PSC (Novus 50%) have doubled to 8 million cubic feet of gas per day (mmcfd) gross.

The Brantas operator, Lapindo, has reached agreement with the gas buyer, Perusahaan Gas Negara, for additional gas sales, currently at a rate of approximately 4 mmcfd. These are in addition to the existing ca. 4 mmcfd, which have been on-stream and sold since January 1999. Depending upon market demand, it is possible that further increases could be forthcoming.

The current arrangements extend until January 2001 after which Novus is optimistic that another, longer term, gas sales agreement will be signed. Novus' Managing Director, Dr Bob Williams, commented:

"These sales volumes are not big, but even small incremental gas sales are of significant economic benefit to Novus because of the very low cost of operations and the large sunk cost pool.

"And there are many positive signs for additional gas sales. There is significant energy demand in East Java much of which is currently satisfied by subsidized diesel. The new democratic government has made several positive steps towards removing fuel subsidies and Wunut remains the only gas field with excess capacity that is hooked in to the local gas grid."

The participants in the Brantas PSC are: NOVUS 50% and Lapindo Brantas (operator) 50%.

For further information contact: Mike Sandy or Bob Williams, Novus Petroleum, 02 9299 4888. (*)