Re Contract

Petrel Resources PLC
07 September 2005


                              SHAREHOLDER UPDATE


The Iraqi Ministry of Oil has informed Petrel Resources that Petrel has been
awarded the Subba and Luhais oil field development service contract. The project
is to develop existing proven reserves as contractor to the Ministry of Oil. The
contract envisages daily production of 200,000 barrels of oil and 100 million
cubic feet of gas.


John Teeling, Chairman, said 'We are absolutely delighted to be successful in
the tender for Subba and Luhais. I hope that this is only the beginning of a
long and fruitful partnership between the Iraqi oil industry and Petrel.
Congratulations and thanks are due to David Horgan, Mahmoud Ahmed and their team
for their years of dedicated work.'


David Horgan, Managing Director, commented 'The contract for $197 million, is to
develop the Sabba and Luhais fields from under 50,000 barrels of oil to over
200,000 barrels of oil daily within a three year period.'






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