Strike Oil Updates on Drilling, Testing at Rayburn Project

Strike Oil is pleased to report on the progress of its testing and drilling activities at the Rayburn Project in the Gulf Coast, Texas.

• Gilbert Freeman 2: testing at substantial production rates.
• Rayburn Field: production targets being maintained.
• Hlavinka Gas Unit 1-1: preparing to run wireline logs at total depth to evaluate shows in Wilcox Formation.
• Duncan 4: ninth Rayburn Project well , to commence shortly.

RAYBURN PROJECT -- WHARTON COUNTY

(Strike Oil 22.8% Working Interest; Operator Cypress E&P Corporation)

WELL TESTING

Gilbert Freeman 2

The Gilbert Freeman 2 well is producing at substantial rates while cleanup and return of the frac fluid continues. Results, which are in line with expectation and comparable to producing Rayburn wells, are expected to be available for reporting to the regulatory authority in the next few weeks.
All test gas and condensate is being sold.

Gilbert Freeman 3

The Gilbert Freeman 3 well is awaiting facilities installation prior to testing being scheduled. Strike Oil Limited ABN 59 078 012 745

PRODUCTION

Production from all Rayburn producing wells, including Gilbert Freeman 2, is being maintained at expected levels.

DRILLING UPDATE

Hlavinka Gas Unit 1-1

The well has reached its proposed total depth of 12,200 feet (3,719 meters). Current operation (Wednesday, Texas time) is preparing to run wireline logs to evaluate gas shows encountered while drilling the Wilcox Formation objectives.

The well is located approximately 9,270 feet (2,825 meters) northeast of the initial discovery well, Duncan 1 and is appraising the Rayburn Field boundaries.

Duncan 4

The Operator, Cypress E&P Corporation, has advised that the rig will be moved to drill Duncan 4, the ninth well in the Rayburn Field, immediately after drilling operations have been completed on the current well.