Lundin Petroleum has created a strategic portfolio of assets on the Norwegian Continental Shelf (NCS). The Alvheim field came on stream in the second quarter 2008. Four new exploration licences were awarded in the 2008 APA Licensing Round. The Luno appraisal well completed in January 2009 confirmed the extension of the Luno field to the north east. Further exploration wells will be drilled in the Greater Luno Area during 2009 to test the potential.

Production
The Alvheim field came on stream during the second quarter 2008 and has been producing above expectations. Alvheim field consists of excellent quality Paleocene sandstone reservoirs. Oil and gas have been found in a group of oil, and oil / gas accumulations, of which the main three accumulations are currently under development (Kneler, Kameleon and Boa). Additional smaller discoveries within the complex may be incorporated into the development later in field life. The field is producing via an FPSO, with oil exported by shuttle tanker and gas by pipeline to the UK. The field is ideally located to act as a hub for satellite production. To date, both the Norsk Hydro Vilje oil field and Volund (Marathon/Lundin Petroleum) with net remaining reserves 17.3 MMboe, oil and gas find have been sanctioned for development. Vilje was part of the initial production stream, and Volund is scheduled to come on stream in 2009.

Development - Contingent Resources
• Alvheim area – the Kobra and Gekko discoveries all represent potential additions to the Alvheim field development and will be further assessed as the development continues.

• PL088, Peik field – Lundin Petroleum has an interest in both the UK and Norway blocks that contain the Peik gas condensate field. Development studies are ongoing with a likely plan of development (PDO) submitted in 2009.

• PL006c South East Tor – appraisal drilling of this 1970’s chalk discovery has been postponed pending further technical and economic analysis.

• PL148, Nemo – located in Block 7/7-2, this oil discovery was successfully appraised in Q1 2008 confirming the extension of the Nemo field. Ongoing conceptual development studies including a potential host platform decision will most likely result in a development decision for the field.

• PL292, Pi – the potential of this oil and gas discovery, located close to BG’s UK Armada field complex, was further enhanced by the discovery of Pi North in May 2008. The Pi North and South structures have estimated recoverable reserves of 19–32 mmboe. The plan forward is the submission of a PDO.

• PL340 – modest contingent resource volumes are carried in this relatively heavy oil discovery in the high quality Tertiary sands. Maturation of these resources will be contingent on success of the neighbouring exploration well planned by the Alvheim group in 2008.

Exploration - Luno Oil Discovery
The Luno oil discovery was made in October 2007 in PL338. Light oil was discovered in a clastic Jurassic reservoir. The size of the discovery is estimated at between 65 mmboe and 190 mmboe of gross recoverable oil from the Jurassic reservoir. The Luno appraisal well completed in January 2009 confirmed the extension of the Luno field to the north-east. The well tested at a flow rate of 4,000 bopd. Recent technical analysis has identified additional potential in extensions of the Luno discovery located up-dip of the Luno discovery which contain significant additional reserve potential. Further exploration wells will be drilled to further test the potential in the Greater Luno area during 2009-2010, which includes PL359, PL410, PL501, PL409.

Exploration - Prospective Resources
With the award of four new exploration licences in the 2008 APA Licensing Round, Lundin Petroleum has a licence portfolio now comprising some 29 licences. Most of the licences are Lundin Petroleum operated. The majority of the licences are located in the North Sea area of the Norwegian offshore from Quadrant 25 in the north (Alvheim area) to Quadrant 3 in the south (adjacent to the Danish border). Three licences are held in the Barents Sea, offshore northern Norway.

Exploration wells planned for 2009-2010 are the following:

• PL0006c – Hyme (Lundin operator, 75%), (drilled P&A dry)
• PL304 – Aegis prospect (Lundin operator, 50%)
• PL338 – Luno extentions (Lundin operator, 50%)
• PL412 – Eiganes (Noreco operator, Lundin 30%)
• PL363 – Mon (Lundin operator, 60%)
• PL340 – Marihone A/B prospect (Marathon operator, Lundin 15%)
• PL359 – Luno High (Lundin operator, 70%)
• PL476 – Frusalen (DNO operator, Lundin 30%)
• PL410 – Luno 3 (Lundin operator, 100%)
• PL203 – South Kneler (Marathon operator, Lundin 15%)