LUNDIN PETROLEUM SPUDS THIRD APPRAISAL WELL 16/5-2S ON AVALDSNES, OFFSHORE NORWAY

Lundin Petroleum AB (Lundin Petroleum) is pleased to announce that drilling of
the appraisal well 16/5-2S on the Avaldsnes discovery located in the North Sea
sector of the Norwegian Continental Shelf (NCS), has commenced.


The planned total vertical depth is approximately 2,150 meters below mean sea
level and the well will be drilled using the semi-submersible drilling rig
Bredford Dolphin. The drilling operation is expected to take approximately 40
days.

The objective of the well is to appraise the Avaldsnes discovery following the
16/2-6 discovery well in 2010 and the successful appraisal wells 16/3-4 and 16/
2-7 drilled earlier this year. The 16/5-2S well will be followed in 2012 by
further Avaldsnes appraisal wells in PL501.

Lundin Petroleum has previously announced estimated gross contingent
recoverable resources for the Avaldsnes discovery located in PL501 of between
800 million and 1.8 billion barrels of oil. The gross contingent recoverable
resources of the Aldous Major South discovery located in PL265 have been
estimated previously by Statoil at between 900 million to 1.5 billion barrels
of oil. The Avaldsnes/Aldous Major South discovery is therefore estimated to
contain gross contingent recoverable resources of 1.7 to 3.3 billion barrels,
which is one of the largest discoveries on the Norwegian Continental Shelf.

Lundin Petroleum is the operator of PL501 with 40 percent interest. Partners
are Statoil Petroleum AS with 40 percent and Maersk Oil Norway AS with 20
percent interest.

Lundin Petroleum is a partner with a 10 percent interest in PL265. Statoil
Petroleum AS is the operator with 40 percent, Petoro has 30 percent and Det
Norske oljeselskap ASA has 20 percent interest.

 

Lundin Petroleum is a Swedish independent oil and gas exploration and
production company with a well balanced portfolio of world-class assets in
Europe, South East Asia, Russia and Africa. The Company is listed at the NASDAQ
OMX, Stockholm (ticker "LUPE") and at the Toronto Stock Exchange (TSX) (ticker
“LUP”). Lundin Petroleum has proven and probable reserves of 187 million
barrels of oil equivalent (MMboe).

 

For further information, please contact:

 

C. Ashley Heppenstall,

President and CEO

Tel: +41 22 595 10 00

 

or

 

Maria Hamilton

Head of Corporate Communications

maria.hamilton@lundin.ch

Tel: +41 22 595 10 00

Tel: +46 8 440 54 50

 

The above information has been made public in accordance with the Securities
Market Act and/or the Financial Instruments Trading Act.

 

FORWARD-LOOKING STATEMENTS

Certain statements made and information contained herein constitute
"forward-looking information" (within the meaning of applicable Canadian
securities legislation). Such statements and information (together,
"forward-looking statements") relate to future events, including the Company's
future performance, business prospects or opportunities. Forward-looking
statements include, but are not limited to, statements with respect to
estimates of reserves and or resources, future production levels, future
capital expenditures and their allocation to exploration and development
activities, future drilling and other exploration and development activities,
ultimate recovery of reserves or resources are based on forecasts of future
results, estimates of amounts not yet determinable and assumptions of
management.

All statements other than statements of historical fact may be forward-looking
statements. Statements concerning proven and probable reserves and resource
estimates may also be deemed to constitute forward-looking statements and
reflect conclusions that are based on certain assumptions that the reserves and
resources can be economically exploited. Any statements that express or involve
discussions with respect to predictions, expectations, beliefs, plans,
projections, objectives, assumptions or future events or performance (often,
but not always, using words or phrases such as "seek", "anticipate", "plan",
"continue", "estimate", "expect", "may", "will", "project", "predict",
"potential", "targeting", "intend", "could", "might", "should", "believe" and
similar expressions) are not statements of historical fact and may be
"forward-looking statements". Forward-looking statements involve known and
unknown risks, uncertainties and other factors that may cause actual results or
events to differ materially from those anticipated in such forward-looking
statements.  No assurance can be given that these expectations and assumptions
will prove to be correct and such forward-looking statements should not be
unduly relied upon.  These statements speak only as on the date of this news
release and the Company does not intend, and does not assume any obligation, to
update these forward-looking statements, except as required by applicable laws.
These forward-looking statements involve risks and uncertainties relating to,
among other things, operational risks (including exploration and development
risks), productions costs, availability of drilling equipment and access,
reliance on key personnel, reserve estimates, health, safety and environmental
issues, legal risks and regulatory changes, competition, geopolitical risk,
financial risks. These risks and uncertainties are described in more detail
under the heading “Risk Factors” and elsewhere in the Company’s 2010 annual
report.  Readers are cautioned that the foregoing list of risk factors should
not be construed as exhaustive. Actual results may differ materially from those
expressed or implied by such forward-looking statements.   Forward-looking
statements included in this new release are expressly qualified by this
cautionary statement.

 

CONTINGENT RESOURCE ESTIMATES

Contingent Resources are those quantities of petroleum estimated, as of a given
date, to be potentially recoverable from known accumulations using established
technology or technology under development, but which are not currently
considered to be commercially recoverable due to one or more contingencies.

The contingent resource range has been estimated including uncertainties in
reservoir extent, reservoir properties and recovery factors. The main
contingency preventing the classification of the resources as reserves is the
definition of a conceptual development plan.

The recovery and production estimates of the Company’s resources provided
herein are only estimates and there is no guarantee that the estimated
resources will be recovered or produced. Actual resources may be greater than
or less than the estimates provided here. There is no certainty that it will be
commercially viable for the Company to produce any portion of these resources.