Sterling Energy plc has commenced drilling the A5 ST (Sidetrack)well on its High Island A-68 lease in the Gulf of Mexico offshore Texas.

The well is the first in a drilling programme planned to more than double production over the next 12 months from recent levels of around 11 million cubic feet of gas equivalent per day. It is targeting “attic” gas reserves up dip from existing productive wells.

Sterling Operations and Technical Director Nigel Quinton said: “This well marks the start of an extensive drilling campaign in the Gulf of Mexico in which we expect to drill at least 6 new wells and undertake the work-over of a number of existing wells.”

The A5 ST well is located in shallow waters (less than 100 ft) approximately 75 miles south east of Houston, Texas. It is immediately north of Sterling’s High Island A-94 lease acquired in August 2003. Drilling is expected to take up to 3 weeks.

The High Island A-68 lease covers 5,760 acres, and the field, which was discovered in 1987, has produced a total of 135 billion cubic feet of gas to date. Participants in the lease are Sterling Energy Inc (operator) 50% and Endeavour Oil & Gas Inc (a subsidiary of Pan Andean Resources plc) 50%.

For further information contact:

Harry Wilson, Chief Executive
Sterling Energy plc: 01582 462 121
Allan Piper, First City Financial Public Relations: 020 7436 7486
Rob Collins, Evolution Beeson Gregory: 020 7071 4311

www.sterlingenergyplc.com
Stock symbol: SEY