Aurado Finds Possible Partner for Liman Block in Kazakhstan

Aurado Energy has entered into a Memorandum of Understanding with a potential corporate partner regarding the possible formation of a joint venture for the continued development of the Company's 90%-owned Liman Block in western Kazakhstan. This potential partner would also participate in the acquisition and development of 2 other blocks Aurado is seeking to acquire in Kazakhstan. The potential partner has until May 31, 2004, to complete its due diligence and enter into a formal agreement with the Company.

In combination with the recently completed equity financings for $15.2 million, the completion of the joint venture would permit Aurado to accelerate the development of the Liman Block and adjacent blocks if the Company completes this acquisition, as well as to diversify into other potential petroleum opportunities in the Caspian Sea region.

Following the Company's evaluation of the well results on its East Tegen Field in the Liman Block in western Kazakhstan, Aurado is preparing to re-enter the East Tegen-2 well to perforate a second zone at a depth of approximately 410 meters. The upper zone, which has been producing test oil in the first two wells, is at approximately 370 meters. The third well, designated East Tegen-5, tested minor volumes of oil and gas but mainly water, indicating that this well penetrated the oil-water contact in the upper zone. After testing the lower zone, the East Tegen-2 well will be put on pump production from the upper zone and, contingent on test results, also the lower zone.

In parallel, operations will commence on the fourth well on the East Tegen Field, designated East Tegen-3, located due west of East Tegen-2, which is expected to encounter oil in the same zones. Further drilling locations have been identified at shallower levels (Albian Sand) in a separate fault block in the eastern flank of the East Tegen Field. The work program will commence shortly, contingent upon weather conditions.