INTRODUCTION

During 2011, Sterling's focus will be upon offshore drilling at Cladhan in the Northern North Sea, and upon progress towards the development at Breagh where first gas production is anticipated in July of 2012. Later in 2011 wells are planned for the F-quad in the Netherlands offshore.

Sterling's intent is to grow through successful exploration and development.

STERLING OPERATIONS

Consistent with Sterling's ongoing strategy, the cost exposure to the pre-discovery phase is managed by farming down and several of the wells planned are either fully carried or partially carried in terms of the final cost to Sterling.