Area Drilling

Jan. 14, 2008

China

CNOOC Ltd. has begun production from Jin Zhou 21-1 gas and oil field in Bohai Bay.

One well was making 3.53 MMcfd of gas as of late December 2007. Peak rate is expected to be 11 MMcfd from three wells and 1,000 b/d of oil from two wells.

JZ 21-1, about 10 km from JZ 20-2 gas-condensate field, is equipped with one unmanned wellhead platform, one pipeline, and one subsea cable.

CNOOC is operator with 100% working interest.

Colombia

Kappa Resources Colombia Ltd. spud the Acacia Este-2 appraisal well on the Las Quinchas Association Contract area in the Middle Magdalena Valley on Dec. 21, 2007.

The discovery well encountered oil in several Tertiary Mugrosa sands in July 2007 and produced a maximum 101 b/d of heavy oil with 5% BS&W, said interest owner Black Rock Oil & Gas PLC. Acacia Este-2 is 1⁄2 km from the discovery well.

Israel

Zion Oil & Gas Inc., Dallas, began field acquisition of a geophysical survey on the Asher-Menashe License between Caesarea and Haifa, Israel.

The company plans to shoot four seismic lines in the Ramot Menashe area and three in the Nahal Me’arot area totaling about 30 line-miles. Acquisition is to be completed by mid-January 2008.

The collected data are to help Zion choose an optimal drillsite on the Ramot Menashe lead and upgrade into a drillable prospect its Nahal Me’arot lead near the Asher-Atlit-1 well.

Romania

Sterling Resources Ltd., Calgary, plans to test an apparent gas discovery at the Doina Sister well on the Midia Block in the Black Sea off Romania.

Drilled by the Prometeu jack up, the Doina Sister well reached TD 1,275 m on Dec. 30, 2007, and topped the main Mio-Pliocene Doina reservoir at 1,139 m, 8 m deep to prognosis.

Initial log results indicate a high quality 21.5-m net reservoir section at 1,139-1,167 m with 26% average porosity. Further gas indications were noted down to 1,200 m.

The prospect is an analog to the existing Doina gas discovery, which tested gas at restricted rates of 17 MMscfd.

Sterling is operator with 65% interest. Petroventures Inc. of Australia has 20%, and Gas Plus International of Italy has 15%.

Tunisia

Storm Ventures International Inc., Calgary, acquired an interest in and became operator of the Cosmos and Yasmin concessions in the Gulf of Hammamet off Tunisia, said Benchmark Energy Corp., Calgary.

SVI plans to submit a development plan for the Cosmos concession in the first quarter of 2008 to Tunisian government authorities. SVI targets first production from Cosmos in the third quarter of 2009. Tunisia’s state ETAP has a 20% back-in right on both concessions, which are in 100-165 m of water 45 km off Tunisia.

The Cosmos Sud structure was drilled and tested in 1983 and produced oil from Miocene Birsa sands, and a 3D seismic survey was shot in 1985 and reprocessed in 1995. Yasmin, which also tested oil from Birsa, was discovered in 1976, and a 3D survey was shot in 1986.

Louisiana

Daybreak Oil & Gas Inc., Spokane, reported completion of the Tensas Farms et al. A-1 well in Tensas Parish, La.

Cretaceous Basal Tuscaloosa perforations at 8,094-8,108 ft flowed 63 b/d of 39° gravity oil and 245 Mcfd of gas with 2,150 psi. FTP on a 6⁄64-in. choke on Dec. 5. On Dec. 20, the rate was 168 b/d and 496 Mcfd of gas at 1,850 psi on a 9⁄64-in. choke. TD is 8,200 ft.

Daybreak is operator with 34.75% interest after payout. The well is 2 miles northwest of the Tensas Farms et al. F-1 discovery well, placed on production in 2006.

The F-2 well, 3 miles southeast of A-1, is at TD 8,310 ft awaiting tests.

The company has more than 20,000 acres under lease in Tensas and Franklin parishes. The drilling targets are based on a 55,000-acre 3D seismic survey that covers the entire leasehold.