Area Drilling

Nov. 19, 2007

Colombia

Kappa Energy Colombia Ltd. has spud the Kristie-1 wildcat on the 62,500-acre Abanico Block in the Upper Magdalena Valley in Colombia.

The well, on a structural-stratigraphic prospect in the Revancha Sur area, is projected to 6,300 ft.

This and a second exploratory well will be paid for through a farmout under which Loon Energy Inc., Calgary, agreed to assign a 25% interest in the Kristie prospect Prospero Hydrocarbons Inc. for funding 50% of the well cost and 25% interest to Prospero for funding 50% of the second prospect. The group has identified a number of other prospects on the block.

Indonesia

Vital Resources Corp., Calgary, will redevelop Ramok and Senabing oil fields west of Palembang, South Sumatra, Indonesia, under an agreement to buy the fields from private companies for $13.6 million. Redevelopment is to involve primary production, waterflooding, and 3D seismic surveys. Current production totals 85-100 b/d of low-gravity oil.

Ramok had 51 wells drilled in 1910-42 and peaked at 290,000 bbl/year in 1928. Senabing had 41 wells drilled in 1906-31 and peaked at 200,000 bbl/year in 1907.

Ivory Coast

Canadian Natural Resources Ltd., Calgary, said it secured a deepwater drilling rig for mobilization in the first quarter of 2008 at Baobab oil field off Ivory Coast.

The company intends to bring three of the five shut-in Baobab wells back on production in 2008 and 2009. Oil production has been off sharply since 2006 due to the failure of sand screens in the wells.

Morocco

TransAtlantic Petroleum Corp., Houston, and Stratic Energy Corp., Calgary, plan to convert part of the Guercif Beni Znassen reconnaissance license in northeastern Morocco into two exploration permits and each farm out half their former 40% working interests to Sphere Investments QSC, Doha, Qatar.

The conversion is subject to government approval.

The two new exploration permits will total 3,893 sq km out of the 13,750 sq km of the former reconnaissance license. Sphere will pay 100% of the costs of an initial 3-year exploration program on the new permits and contribute to costs to date.

Morocco’s ONHYM is carried for 25% of costs but pays its share of development costs.

Initial 3-year work program on the 8-year permits is for reentry of an existing well and shooting 300 line-km of 2D seismic.

Russia

Volga Gas PLC, London, was awarded the Urozhainoye-2 license covering 354 sq km in Russia’s Volga Region.

The license is near 30 gas-condensate and oil fields and 15 km north of the company’s Karpenskiy license in the northwestern Precaspian basin.

The Urozhainoye-2 license contains the 1991 Sobolevsky field discovery well, TD 3,307 m, which flowed 1,213 b/d of 35.9° gravity oil and 2 MMcfd of gas on an 8-mm choke from four Bobrikovsky intervals at 2,647-59 m.

Volga Gas, which plans to shoot 2D seismic to identify other structures to drill, intends to work over the well and start production in 2008.

Indiana

Baseline Oil & Gas Corp., Houston, said no proved reserves are associated with its 171,000 gross acreage position in the Illinois basin New Albany shale play, but all six of the horizontal wells in which the company participated in 2007 tested gas.

Baseline said it is working with its partners to define optimal completion and stimulation techniques and preparing to install gas gathering, treatment, and compression to place the wells in Greene and Knox counties on line.

The company plans to drill and complete up to 20 wells and begin selling gas in 2008.