RWE Dea announced on Friday that it has entered into a farm-in agreement on two exploration blocks offshore Malta operated by Global Petroleum Limited, subject to approval by the Maltese Government.

The two blocks, Blocks 4 and 5 of Area 3, are located in the southern region of the Ragusa Trough which extends south from Sicily in the Mediterranean Sea. The Ragusa Trough contains the Vega oil field in the Italian part of the basin.

RWE Dea will farm-in into 20% of the blocks in return for a commitment to undertake a seismic programme in the second half of this year. Global will retain 80% of the blocks through its subsidiary Astral Petroleum.

The two companies also have the option, to be exercised during the term of the Exploration Study Agreement which ends on 31 December 2006, to enter into a Production Sharing Contract (PSC).

The PSC has a one well minimum work commitment in the first two years. If taken up, RWE Dea has the option to earn an additional 50% in the two blocks by carrying Global's share of the cost of the one well on a dry hole basis.

Commenting on the farm-in, RWE Dea Chairman of the Board of Management, Dr. Georg Schöning said: "Offshore Malta represents a new opportunity in the Mediterranean area for RWE Dea but one which we believe has excellent prospects. The blocks contain a number of leads which will be the focus of the forthcoming seismic programme. We look forward to working in this new exploration area with Global Petroleum."