Dejour to Implement Woodrush Waterflood Program

Dejour Enterprises Ltd. has received approval from the BC Oil and Gas Commission for the implementation of a waterflood program in the Halfway Oil pool at its Woodrush project in Northeastern British Columbia. Project design has been completed and construction will begin in early January. The project includes the drilling of a water supply well, converting one producing well to injection and drilling a second injector, upgrading power generation, installing pumps, additional tankage and water treatment facilities at a gross cost of $3.2 million.

Water injection is expected to commence in early February, resulting in an immediate increase in production as the new pool rules take effect and the current British Columbia well production allowable scheme is phased out. Production from the pool is projected to increase throughout the year with peak response to water injection expected in the third quarter of 2011. At that time a third producer may be drilled. Dejour has a 75% WI in this project.

"The successful implementation of this milestone project will complete the development of the Halfway oil pool. The waterflood will increase the recovery of the oil in the pool from 17% to 42% of original oil in place, providing sustained, economic oil production for the next several years that will allow Dejour to accelerate repayment of an existing credit facility, attract a longer term more conventional banking facility, with the respective cost savings and fund other developing oil opportunities in the area out of cash flow," comments Hal Blacker, Dejour COO.