Operations Update

Egdon Resources PLC
16 May 2006


16 May 2006

For immediate release

                              EGDON RESOURCES PLC

                          Portland-1 Operations Update


Egdon Resources Plc (AIM : EDR), the onshore UK focused energy company, today
provides an update on its gas storage project on the Isle of Portland in Dorset.


Portland Gas Limited ('the Company'), a wholly owned subsidiary of Egdon
Resources Plc, is drilling the Portland-1 borehole on the Isle of Portland,
Dorset to confirm that a halite sequence (called 'S7' by the Company), within a
Triassic salt sequence ('Saliferous Beds') of the Wessex Basin, is suitable for
the creation of caverns to store natural gas.


As previously reported, the top of the Saliferous Beds was encountered at a
depth of 2139 metres. Following the setting of a 7 inch steel liner in the hole,
coring of the sequence, using a wireline retrievable 4.2 metre core barrel
within a 'PQ' coring string, commenced on 14 April 2006 at a depth of 2149
metres.


On 26 April, after cutting core number 32 at a depth of 2260.98 metres, the 'PQ'
string jammed in the hole and whilst trying to pull it free the pipe parted at a
depth of 1086 metres. During subsequent 'fishing' operations to retrieve the '
PQ' string that remained in the hole, the rig had mechanical problems which
further delayed the operations. The 'PQ' pipe was partially recovered to a depth
of 2107 metres. On 12 May the decision was made to sidetrack the well at a depth
of 2040 metres, drill the new hole section to 2250 metres (with the sidetracked
well path programmed to be approximately 10 metres to the northwest of the
original hole at this depth) and then resume coring using a conventional 18
metre core barrel on the end of drilling pipe.


At 06:00 hours today the window in the 7 inch steel liner had been cut and
drilling operations will resume within the next 24 hours. It is anticipated that
coring will re-start within the next 3 days.


The top of the S7 sequence was encountered at a depth of 2235 metres (to be
confirmed by wireline logging after the Saliferous Beds has been drilled). Core
has been recovered in the well to a depth of 2256.68 metres. To date, 117.68
metres of the Saliferous Beds have been confirmed, of which 21.68 metres are
interpreted as the S7 sequence. The S7 is expected to be approximately 180
metres thick at Portland-1.


Core samples from the section already drilled have been taken to laboratories in
Germany to enable the Company to start a series of tests to confirm the
suitability of the Saliferous Beds on the Isle of Portland for the development
of a gas storage facility and, if so, to optimise the design of the storage
caverns. The results of these tests are anticipated at the end of July 2006. If
positive, this will result in a planning application being submitted in
September or October 2006.



For further information please contact:


Egdon resources Plc


Andrew Hindle, Joint Managing Director         01256 702 292

Mark Abbott, Joint Managing Director



Buchanan Communications


Eric Burns                                     01943 883 990

Ben Willey                                     020 7466 5000



Company Background


Egdon is an established, UK-based energy company primarily focused on the
hydrocarbon-producing basins of the onshore UK. Egdon also has exploration
interests in the offshore UK and France. Egdon's shares are traded on the AIM
market.


The Company is developing two major business areas:


An oil and gas exploration and production business which has a portfolio of
twenty exploration licences containing identified oil and gas prospects ranging
from discoveries under appraisal through to higher risk but higher reward '
wild-cat' exploration prospects.


A gas storage business initially focused on the prospective development of a
major salt cavern gas storage facility beneath the Isle of Portland, Dorset.


In accordance with AIM rules -guidance for mining, oil and gas companies, the
information contained in this announcement has been reviewed and signed off by
the Joint Managing Director of Egdon Resources Dr Andrew Hindle, a Chartered
Geologist with over 22 years experience.

                      This information is provided by RNS
            The company news service from the London Stock Exchange END

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