BG Group today announced the results of a sidetrack well drilled on the "Buzzard" oil discovery in the UK North Sea. The discovery lies in the PanCanadian operated licence P986, 100 kilometres north-east of Aberdeen, and has been drilled and tested by BG Group on behalf of the consortium partners.

The plan to sidetrack was announced on June 7, after the partners announced a significant oil discovery on the "Buzzard" exploration prospect.

The sidetrack from the original well encountered the same high quality hydrocarbon bearing reservoir sands as the original well bore. Both the discovery and sidetrack wells each contain more than 250 feet of hydrocarbon bearing sandstone, with an average porosity of 24 per cent and high permeability. The sidetrack has extended the oil column of the discovery to at least 750 feet. These two wells have indicated oil reserves of over 200 million barrels in this part of the "Buzzard" structure.

BG Executive Vice-President Jon Wormley today said:

"This new data shows that "Buzzard" may be one of the most substantial finds in the North Sea in recent years, with further significant upside potential in the untested areas. Further appraisal drilling is planned, with the drilling of two or three new wells beginning this autumn. This has the potential to increase significantly the currently established recoverable reserves."

Notes to Editors

The original "Buzzard" discovery well was drilled in 320 feet of water. During testing, the well flowed at 6,547 barrels per day of light oil and 0.97 million cubic feet per day of natural gas on a 36/64th-inch choke. These rates were constrained by the limits of the testing equipment.

As well as drilling and testing on behalf of the consortium, BG Group holds a 19.99% interest in the licence. Other interest-holders are PanCanadian, the operator, (45.01%), Intrepid Energy North Sea Ltd (30%) and Edinburgh Oil and Gas (5%).

BG Group is a significant holder of hydrocarbon reserves on the UK Continental Shelf, where it also operates the Blake, Armada and Easington Catchment Area fields. The company is also involved in gas and oil developments in some 20 countries worldwide, including Bolivia, Egypt and Trinidad.