Re Agreement

Enterprise Oil PLC
19 December 2000


Enterprise Oil signs Iranian South Pars deal

Enterprise Oil plc, through its wholly owned subsidiary Enterprise Middle East
Limited ('Enterprise'), has signed a Participation Agreement with Petropars
Limited ('Petropars') subject to approval of the National Iranian Oil Company
('NIOC'), and certain other conditions being satisfied. This will provide
Enterprise with a 20 per cent interest in Phases 6, 7, and 8 of the South Pars
gas field development project offshore Iran, through assignment of a
proportionate interest in the Service Contract entered into by Petropars and
NIOC in July this year. 

As part of these arrangements Enterprise will provide technical assistance to
Petropars and make a financial contribution of up to $15 million towards the
cost of an appraisal programme to be conducted next year. 

Gross project costs in the Service Contract, of which Enterprise will bear its
proportionate share, include appraisal, offshore and onshore development
costs, and amount to $2.65 billion. This investment is expected to be made
over a six year period.

Enterprise will work jointly with Petropars in all aspects of the development
and take the lead in the offshore part of the project.  This will consist of
approximately 30 production wells to be drilled from three new wellhead
platform complexes, each with a 32 inch pipeline to the shore, where gas
processing will take place.  The gas will then be transferred by an onshore
pipeline for injection into the Agha Jari oilfields to enhance existing oil
production.

Phases 6, 7 and 8 of the South Pars development will together produce 3,000
million standard cubic feet per day of gas, 120,000 barrels per day of
condensate and approximately 3,300 tonnes per day of LPG.  Enterprise will
receive its share of revenue on a buy-back basis under the Service Contract
from the sale of condensate and LPG produced in association with gas
production.  Petropars is currently operating Phase 1 of the South Pars
development and is also a partner with ENI in Phases 4 and 5.

 Pierre Jungels, Chief Executive, commented: 'Enterprise is delighted to have
the opportunity to work with Petropars to advance Phases 6, 7 and 8 of the
South Pars development by contributing specialist technical skills in
drilling, reservoir engineering and offshore operations.  The agreement we
have reached with Petropars will enable Enterprise to participate in a world
class project in a manner which reduces commercial and technical risks before
significant expenditures are incurred.

'This is our first major involvement in Iran's oil and gas industry and an
important first step in building a profitable business in the country.  It
also marks the successful implementation of our strategy to focus our new
venture activity in proven hydrocarbon provinces.'


For further information contact

Pierre Jungels, Chief Executive                                 020 7925 4199
Patrick d'Ancona, Head of Public Relations                      020 7925 4160
Peter Reilly, Head of Investor Relations                        020 7925 4476
Sucharita Sethi, Public Relations Officer                       020 7925 4160


Notes to Editors

South Pars

South Pars is the world's largest gas field and lies in the Persian Gulf about
100 km South of Assaluyeh in Iran covering an area of about 3,700 square
kilometres. The field lies in waters of approximately 70m and crosses the
median line into Qatar, where it is called the North Field.   The highly
productive Khuff reservoir is at a depth of around 3,000m.  In January 2000
Iran increased its estimate of total South Pars reserves in Iranian waters
from 350 to 436 TCF of gas and 15 billion barrels of condensate. 


Petropars

Petropars Limited is owned 40 per cent by the Industrial Development and
Renovation Organisation (IDRO) and 60 per cent by the National Iranian Oil
Company Pension Fund.