CGX Energy and its subsidiary ON Energy report that preparations for the drilling program in Guyana are proceeding on the defined drill targets. On shore logistics are on schedule, including warehousing, road building and drill pad preparation. ON Energy has agreements for drilling and other services in place subject to finalizing contracts. Drilling supplies, mud and other items including casings have been purchased and are scheduled to leave from Louisiana, USA by barge through the Gulf of Mexico. The shipment of these supplies has not received clearance due to the stream of recent hurricanes in this region and as a result the shipments have been delayed.

Kerry Sully, President of CGX and Chairman of ON Energy stated "We are pleased to have condensed into one year all of our preliminary exploration, successfully scheduling our operations into Guyana 's dry season. By fast-tracking our operation, we had hoped to start drilling in the fourth quarter of 2004, but unfortunately hurricanes in the Gulf of Mexico and the Caribbean have delayed drilling until January 2005."

Warren Workman, Vice-President of CGX and President of ON Energy added "Our new seismic has supplemented 8 prospects that had been identified as leads with our geochemical program. Further, an enhanced geochemical analysis on recently acquired samples suggests a likelihood of lighter oil. We are encouraged that closing this rights issue should allow us to expand our drilling program to test additional targets."