Through its subsidiary Santos Egypt, the company will acquire a non-operated equity position in three exploration Concession Agreements totalling 1,350sq.km in the Gulf of Suez, Egypt from Devon Energy.

The move means Santos will join several Australian companies in North Africa. Woodside is now established in Mauritania with Hardman and Roc Oil, along with its stake in Algerian oil exploration and the Ohanet gas and liquids stripping project with BHP Billiton.

Additionally Roc has an interest in Equatorial Guinea, Bounty Oil and Gas is in Tanzania and Pancontinental Oil and Gas has a large slice of Kenyan acreage.

Santos’ participation will earn equity interests ranging from 20% to 50% in the concessions, which contain exploration opportunities with a gross unrisked mean resource potential of several hundred million barrels of oil and possibly gas.

“This is another significant step for Santos and further builds our international exploration interests,” said Santos managing director John Ellice-Flint.

The Ras Abu Darag concession and South East July concession are offshore blocks located in 40-60 metres of water. The North Zeit Bay concession is an onshore block and contains Devon’s East Zeit production facilities. The JV’s first well, Khefren-1X is planned to spud in mid July, 2004 in the South East July block.

“The Gulf of Suez is a prolific hydrocarbon area with important remaining exploration potential. The joint venture plans an active drilling campaign commencing mid July.”

“Importantly, our targets are close to production facilities, which will enable

accelerated cycle-times between discovery and production.”

In the past month Santos has expanded its Indonesian and USA exploration acreage and prospects and signed an agreement to acquire additional Indonesian oil and gas assets, following PT Medco’s bid for Novus Petroleum.