BG Exploration & Production (BG E&P), a subsidiary of BG plc, and its partners Shell and Edison International today announced the signing of a Gas Sales Agreement (GSA) with the Egyptian General Petroleum Company (EGPC), to supply gas from the Rosetta Concession, offshore Nile Delta, Egypt.

The signing follows successful testing of the first exploration well within the Rosetta Concession in April, and the recent drilling of two subsequent discovery wells. A fourth well to appraise the first discovery is currently being drilled.

Gas deliveries will commence in January 2000 and will rise to 250 million standard cubic feet of gas per day (mmscfd). The gas will be sold to EGPC and delivered into the national grid system east of Alexandria.

Frank Chapman, BG plc Executive Director for Exploration and Production, said: "It has taken BG E&P about six months from the drilling of the first Rosetta discovery well to conclusion of the GSA and sanction of the Rosetta development. This would be a first for any type of development, but is exceptional for a gas discovery.

"Rapid progress has been made possible by the excellent working relationship with our partners and EGPC. It provides confirmation of BG E&P's intention to accelerate ventures as part of our strategy of developing the scale and profitability of our business."

The Rosetta Concession area covers approximately 3730 square kilometres. The first discovery well, Rosetta-3, tested in excess of 60 mmscfd. A further two wells have been drilled and contain a total of more than 260 metres of net gas pay. A new joint venture company, Rashid Petroleum Company, is to be formed by EGPC, BG and its partners, to develop the three gas discoveries.

The Rosetta Concession exploration group consists of BG Exploration & Production Limited as operator with a 40 per cent interest, Shell Egypt with 20.4 per cent, Shell Austria with 19.6 per cent and Edison International with 20 per cent.

Notes To Editors:

BG plc's E&P operations in Egypt are managed through its subsidiary BG Egypt S.A. It has interests in two development leases and four exploration concessions.

The development leases are:

Zaafarana, located in the north Gulf of Suez, and operated by the Zaafarana Oil Company (ZAFCO), in which BG Egypt S.A. has a 25 per cent shareholding. Current production is in excess of 13,000 barrels of oil per day.

Rosetta, located in the Rosetta Concession and will be operated by Rashid Petroleum Company.

In addition to Rosetta, the exploration Concessions are: North Sinai, covering approximately 6,500 sq kms in the Eastern Mediterranean Basin, east of Port Said, where BG Exploration and Production is the operator and has a 50 per cent interest with its partner Amoco.

West Delta Deep Marine, covering 8,500 sq kms in the Nile Delta Basin, north east of Alexandria, where BG Exploration and Production is the operator and has a 50 per cent interest with its partner Edison International.

North Red Sea Block 1, covering 12,500 sq kms, where BG Exploration and Production is the operator with a 44 per cent interest, and LASMO and Edison International have interests of 36 per cent and 20 per cent respectively.