Petrogen Increase Natural Gas Flow from Emily Hawes #3A Well

Petrogen reports initial natural gas flow rate results from the Company's Emily Hawes Field #3A well (EH#3A) compression initiative. Since the implementation of the initial rate from the first stage of compression installed on the EH#3A, current natural gas production rates from the well have already increased by more than 50% from rates observed prior to Hurricane Rita.

On October 7th, 2005, crews were mobilized to Emily Hawes Field to install the Company's two-stage compression system to help increase and optimize daily natural gas flow rates from the EH#3A. Due to high line pressures on the Northern Natural Gas/Matagorda Offshore Pipeline System sales pipeline (NNG/MOPS), optimum daily natural gas production rates from the EH#3A were being suppressed. The addition of the first stage of compression on the EH#3A will mitigate any further suppression from the NNG/MOPS line pressures.

Currently, natural gas production rates from the EH#3A utilizing initial compression speeds, are averaging between 380 Mcfgd to 500 Mcfgd. As the well continues to clean up, operations personnel indicate compression speeds will be increased within the first stage of compression to further improve gas sales.

Petrogen's Chairman and CEO, Sacha H. Spindler stated, "We are very pleased with the initial flow rate results from the Emily Hawes #3A since the installation of our two-stage compression system. As the well continues to clean up, we have several options that remain available to us that can continue to further improve gas sales from the well. These include increased speeds within the first stage of compression, as well as the implementation of the second stage of available compression that will further improve overall daily natural gas production flow rates."

On November 23, 2004, Petrogen announced that it successfully tested natural gas from the EH#3A well from the Basal Miocene M1 sand with an absolute open flow of 1,998 mcfgd; 978 mcfgd was tested on a 14/64" choke with flowing tubing pressure of 1,395 psi and a final shut-in pressure of 1,950 psi. On May 7, 2005, crews were mobilized to Emily Hawes Field and immediately began an extended production test of the EH#3A well. On August 3rd, 2005 Petrogen announced that it had commenced natural gas sales from the EH#3A well.

The Emily Hawes Field property is located approximately 90 miles southwest of Houston, Texas within the prolific oil and gas producing Miocene-Frio trend of the onshore and offshore Texas Gulf Coast. Near term plans include the expansion of operations through the development of a number of infill and step-out drilling locations to that of the EH#3A well targeted at the Basal Miocene Sands within the Emily Hawes Field.
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