Operational Withdrawal From Trinidad

Venture Production plc ('Venture'), the Aberdeen based UK independent oil and gas production company, today announces that it has entered into an agreement to sell its Trinidad operations (Venture Production Trinidad Limited or 'VPTL') to Ten Degrees North Energy Limited ('TDN'), a recently formed Trinidadian company.

TDN has been established by Dr Jim Lee-Young, previously Venture's General Manager in Trinidad and Bruce Dingwall, who was a founder and former Chief Executive of Venture. Venture will retain an interest in its Trinidadian assets through a 40% equity stake in TDN and will appoint a representative to the Board. However, Venture will cease to have any direct operational involvement in Trinidadian operations, consistent with its corporate focus on expanding its United Kingdom Continental Shelf ('UKCS') business.

The consideration payable to Venture upon legal completion comprises:

$11.0 million in cash proceeds;
$10.0 million nominal in convertible subordinated notes (the 'Loan Notes'); and
9,000 shares of $1,000 common stock representing 40% ownership of TDN.

In addition, including approximately $2.0 million of cash working capital at 31 December 2004, gives a headline value of the gross assets of VPTL of $32.0 million, consistent with the book value post the exceptional write down at the end of 2004. In the year to 31 December 2004, VPTL made an operating loss of £2.0 million before an exceptional writedown of £18.1 million. At 31 December 2004, VPTL had Proven and Probable reserves of 8.2 million barrels of oil equivalent ('MMboe'), almost entirely oil, over 70% of which were undeveloped. Average net daily production in 2004 was 1,200 boepd, or approximately 7% of total Group production.

The cash consideration to be received by Venture will be used to reduce current bank borrowings. The Loan Notes will carry a coupon that increases through time from 2% to 9% and are repayable from 2010 onwards. In addition, 50% of the Loan Notes will be convertible into TDN equity at $1,500 per share in the event that the rate of return to TDN investors exceeds a specified level. In the event that TDN achieves certain valuation events within a 24 month period from completion, including being listed on a recognised stock exchange, or being sold or raising significant additional equity and the rate of return to initial TDN investors is below a certain threshold, the subscription price of their equity will be adjusted downwards (subject to a maximum 20% adjustment) so as to ensure a 15% internal rate of return is achieved on the new capital invested.

In addition to the 40% to be owned by Venture, TDN will be 24.4% owned by Trinidadian institutions with the remaining 35.6% to be held by Messrs Lee-Young and Dingwall, who are both Trinidadian citizens. The sale of VPTL to TDN constitutes a related party transaction and, as such, the agreement is conditional upon the transaction receiving shareholder approval. A circular will be sent to shareholders containing full details of the transaction and the date of an Extraordinary General Meeting as soon as possible.

Venture's decision to withdraw from Trinidad resulted from a strategic review of its Trinidadian operations in the context of their reduced materiality within Venture's portfolio. The Board, sensitive to the related party nature of this disposal, took appropriate steps to explore all available options for the planned withdrawal after an approach by TDN during the fourth quarter of 2004. As a result the Board has unanimously concluded that this transaction represents the best available value for shareholders, not only in terms of current value but also potential future value upside.

In addition to shareholder approval, the transaction is subject to Trinidadian regulatory approvals and is expected to complete in the fourth quarter of 2005.

Commenting on the announcement, Mike Wagstaff, Chief Executive, said:

"With the recent rapid growth of our UK business, Trinidad now represents a very small part of our ongoing operations and operational withdrawal, in order to focus all our resources on developing our North Sea business, is the correct course. Nevertheless, we believe that there remains significant potential value in these Trinidadian assets, which we wish to retain for shareholders. We believe that a local Trinidadian funded and managed company will be best placed to unlock this potential. We have therefore structured a transaction where we receive a fair headline valuation for the assets in their current largely undeveloped state yet retain a material interest in the upside."

Enquiries

Notes to Editors

Upon legal completion of the disposal announced today Venture will transfer its entire interests in Trinidad to TDN, a newly established company in which it will hold 40% equity ownership.

Venture's Trinidadian interests consist of:

Licence/Concession	Venture Interest	Operator	Status
WD-13	100.0%	VPTL	Producing Oil Field
WD-14	100.0%	VPTL	Producing Oil Field
Tabaquite	100.0%	VPTL	Producing Oil/Gas Field
Brighton Marine	100.0%	VPTL	Producing Oil Field
Point Ligoure	50.0%	VPTL	Producing Oil Field

This will leave Venture wholly focused on the United Kingdom Continental Shelf ('UKCS')
Venture's Trinidadian assets had been expected to produce at an average rate of around 2,400 barrels of oil per day ('bopd') net to Venture in the 12 months to 31 December 2005, subject to an investment programme which will now be the responsibility of TDN to implement.
Venture currently owns interests in 21 fields in the UK North Sea of which 10 are in production (all operated), 11 are either under development or near term development candidates (eight operated).