Forum Energy Plc, the UK-based energy group with a portfolio of oil, gas and coal assets in the Philippines, today announces its preliminary results for the six months to 30 September 2005.

Highlights of the year include:

• Raised £3.4 million in a pre-IPO placement in May 2005
• Admitted to AIM in August 2005 raising £11.0 million
• First revenues from gas and coal developments in the Philippines expected in the first half of 2006
• Completed 2D seismic survey in Tañon Straits, SC40
• Completed 3D seismic survey over the Sampaguita Gas Field, GSEC101
• Completed feasibility study for the Libertad Gas Field development, SC40

Commenting, David Robinson, Chief Executive, said:

"We are very pleased with the progress that Forum has made since its inception earlier this year, through the acquisition of the Philippine oil & gas and coal assets of Sterling Energy plc in the UK and FEC Resources Inc. in Canada. We look forward to many positive developments during the months ahead."

For further information, contact:
David Robinson, Chief Executive, Forum Energy plc: +44 (0) 1932 445 346
Adam Westcott, Noble & Company Ltd: +44 (0) 131 225 9677
Ian Foster, First City Financial Public Relations: +44 (0) 20 7436 7486 or +44 (0) 7739 185 050

Chairman’s Statement:
Dear Shareholder:

Since its establishment in April 2005 through the merger of the Philippine oil & gas and coal interests of FEC Resources Inc. of Canada and of Sterling Energy Plc of the UK, Forum Energy Plc has made considerable progress in advancing the exploration, appraisal and development of its portfolio of assets. It is the only AIM-listed international E & P company that is currently focused exclusively on the Philippines.

Financial
Forum recorded a loss of US$0.571 million for the interim period ended September 30, 2005. This loss was primarily attributable to expenses associated with the administration of the company in the period since formation whilst the IPO was being completed.

The company successfully raised £3.4 million (pre-expenses) in a pre-IPO placement at 100p per share in May 2005, followed by an IPO placement of £11.0 million (pre-expenses) at 112p per share and admission to AIM in August 2005. Forum’s working capital position as of September 30, 2005, was US$16.4 million

The Board of Directors has approved the 2005 and 2006 capital and operating budgets for Forum, which include development of the Libertad Gas Field and the Central and Southern Cebu coal operating contracts (COCs), all of which are expected to become revenue generating during the first half of 2006.

General Survey and Exploration Contract 101 (GSEC101)
In August, Forum completed a key 3D seismic survey across the major Sampaguita gas discovery, offshore the Philippines. The survey was carried out over an area of 248 square kilometres by DGC Asia Pacific Ltd, part of Veritas. The data is currently being processed in the UK by Veritas, and is expected to be completed by the end of the first quarter of 2006. The processed data will be interpreted at Forum’s office in the Philippines.

Interpretation and analysis of the 3D seismic data will provide more information on the commercial potential of this highly promising discovery, and help identify the best location for a possible appraisal well which is targeted to be drilled over the next 18 months, subject to rig availability and, if deemed appropriate, finding a farm-in partner.

The Sampaguita Gas Field is located within license area GSEC 101 west of Palawan Island in the South China Sea; Forum holds 100% of this under-explored acreage, which covers 10,630 square kilometres and contains at least eight other undrilled prospects and leads besides Sampaguita.

Sampaguita lies 250 kilometres southwest of the world-class Malampaya Gas Field, where operator Shell has installed extensive production facilities and pipeline infrastructure that supplies gas to three Philippine power plants. Gas has already been tested from Sampaguita during the 1970s and 1980s. A recent independent assessment by petroleum consultants PGS Reservoir Ltd estimated that the field could contain potential recoverable gas reserves of up to 2.3 trillion cubic feet.

Service Contract 40 (SC40)
Forum completed an offshore 2D seismic acquisition programme in the Tañon Strait, west of Cebu Island within SC40, in June 2005. The data acquired is being processed by Spectrum Energy (UK), along with 1,000 kilometres of vintage 2D data from the region. The processed lines will be integrated with the reprocessed vintage lines and interpreted in-house in the Philippines. Interpretation is forecast to be completed during the second quarter of 2006.

The seismic survey, completed by the Veritas Searcher, acquired 310 kilometres of new 2D data in licence SC40, where Forum holds a 67% interest. Structures within the area covered by this survey, including the Central Tañon and Jibitnil Island prospects, have combined potential reserves of 350 million barrels of oil equivalent according to estimates by PGS Reservoir Ltd.

The new seismic lines have been acquired in order to improve the mapping of the Central Tañon and Jibitnil Island prospects. The seismic data will be tied to old wells such as Bangus and Anapog (for Central Tañon) and Bakyad (for Jibitnil Island) for better well-to-seismic correlation. The new seismic lines acquired between Jibitnil and Cebu Islands will help define more precisely the Jibitnil Island structure which is cut by several faults. In addition to seismic data, the survey included the acquisition of marine gravity and magnetic data, which is now being processed by Ark Geophysics Ltd (UK).

Elsewhere within SC40, first gas production is expected during the first half of 2006 from the onshore Libertad Gas Field, to supply a 2 MW gas-to-electricity project. The Philippine Department of Energy is expected to formally announce a Declaration of Commerciality for the Libertad Gas Field shortly after which development of the field will begin, subject to satisfactory commercial terms and approvals.

In 2003, a gas and oil discovery was made within SC40 at the northern tip of the island of Cebu, in the Maya region. Workover and testing of one of the discovery wells, F2X, is planned to begin in the first quarter of 2006, once the necessary materials have been delivered and the scheduled maintenance and refurbishment of the company’s 66.7%-owned Hycalog drilling rig has been completed.

The open-hole section within the F2X well will be cleaned out and a liner run to prepare the well for testing through a completion string. If the well flows oil, it will continue into an extended testing period. If it produces gas, it will be shut-in and considered for future production as a gas-to-electricity project, similar to the Libertad Gas Field development.

Coal Operating Contracts
Forum’s 66.7%-owned coal operating contracts (COCs) in Central and Southern Cebu, COC 131 and COC 132, are currently being appraised and developed in accordance with the company’s commitments to the Philippine Department of Energy. These commitments are due to be fulfilled during the first quarter of 2006, at which time commercial production is expected to begin. Some incidental production is likely to occur prior to that from the driving of shafts and other development activities.

CSA Group has produced a Coal Competent Person's Report covering COC 131 and COC 132. Proven and probable coal reserves are estimated to be 1.4 million metric tonnes and 3.5 million metric tonnes respectively.

New Ventures
In May, Forum entered into an agreement with Basic Consolidated, Inc. in the Philippines whereby the parties agreed to work under an exclusivity period towards finalizing the purchase by Forum of Basic’s petroleum interests in the Philippines. The exclusivity period was subsequently extended to 31 January 2006 while Forum continues the technical due diligence of Basic’s petroleum interests.

This potential acquisition is consistent with the company’s strategy to consolidate its position in the country by acquiring further oil, gas and coal assets, and if successful, would add significant value to Forum’s portfolio. In this regard, the company is also in discussions with a number of other groups that own oil, gas and coal assets in the Philippines.

Additionally, in June 2005, Forum loaned $600,000 to MG Mining and Energy Corporation in the Philippines, as part of an option agreement to potentially acquire some or all of MG’s coal mining assets in the country. To date, Forum and MG have been unable to agree to the terms of an acquisition, and it is uncertain whether a transaction will ultimately be completed between the parties. The $600,000 loan plus interest is due and payable as of September 30, 2006 or earlier in certain circumstances, and security is provided by MG’s coal operating contract which is located next to Forum’s Southern Cebu COC.

Outlook
Forum Energy is well-positioned to move forward with the exploration, appraisal, and development of its existing portfolio of oil, gas and coal interests in the Philippines, as well as with the acquisition of additional interests in the country. The company is in a strong financial position, which should be further improved as first revenues from coal production and from the Libertad Gas Field begin as expected in the first half of 2006.

In addition to the start of production from Libertad and its coal operating contracts, Forum expects to be in a position to report to its shareholders on other significant developments in the coming months. These include the results of interpretation of the 3D seismic acquisition over the Sampaguita Gas Field and of the 2D seismic covering the Tañon Straits prospects off Cebu; the results of the workover and testing of the F2X well in the Maya region on Cebu; the possible acquisition of the petroleum interests of Basic, and other promising opportunities that are currently being evaluated and pursued.

We believe the future looks extremely positive for Forum and its shareholders.

Alan B. Henderson
Chairman

David R. Robinson
President and Chief Executive Officer

Financial Statements
Please see the Interim Statements PDF for financial statements and notes that go with this report.