Calvalley Declares Block 9 in Yemen Commercial

Calvalley Petroleum, Operator of Block 9 in the Republic of Yemen, has advised the Ministry of Oils and Minerals that Commercial Discoveries of Oil have been made at Hiswah, Al Roidhat, Auqban and Qarn Qaymah in Block 9. In accordance with Article 3.4 of the Production Sharing Agreement with the Republic of Yemen, the Company, in conjunction with its Joint Venture partners, has requested conversion of a substantial part of Block 9 into a Development Area. The Company is awaiting approval by the Ministry of Oil and Minerals of its application.

The Declaration of Commerciality was made following an exploration and appraisal program that consisted of the drilling of eleven wells. Calvalley has prepared and submitted an Initial Development Plan to the government which consists of drilling several horizontal and vertical wells, installing field gathering systems, early production and truck loading facilities. It is the objective of the Joint Venture to establish early production and cash flow by initially trucking the oil to a main transmission pipeline system operated by a third party for export.

Once Ministry approval has been obtained, the Company will commence the early development of the Hiswah Field, and will embark on detailed development planning and pipeline feasibility studies to fast track the full field development of the Hiswah, Al Roidhat, Auqban and Qarn Qaymah Fields.