Blue Dolphin Energy has commenced production in the High Island Block 115 sidetrack 2 well on November 26, 2007. As the Company previously reported, it had earned a 2.5% working interest in the well. The interest is held by its wholly owned subsidiary, Blue Dolphin Petroleum Company. The operator reports that the well is currently flowing at a rate of approximately 9 million cubic feet of gas per day with a 10,500 psi flowing tubing pressure and an 11,010 psi shut-in tubing pressure. The well is a sidetrack of the original B-1 wellbore in the block. As the well has recently commenced production, the production level has not yet stabilized. There will be adjustments to the production rate after a sustained steady flow has been achieved. The Company will issue further information as operations progress. Blue Dolphin's net revenue interest in the well is 2.008%.