Oriental Successfully Completes Phase 1 Program for Okwok Field

Oriental Energy Resources Limited has successfully concluded its Phase One Appraisal and Exploratory Drilling Program for the Okwok Marginal Field located in Oil Mining Lease (OML) 67, which Oriental operates under a farmin agreement with ExxonMobil and the Nigerian National Petroleum Corporation (the "Farmors") that was executed on May 9, 2006. The Okwok Field is located twenty-five miles (40 km) offshore in Nigeria's prolific southeastern producing area in an average water depth of 150 feet.

Oriental is joined in the project by Addax Petroleum (Offshore Nigeria) Limited ("Addax"), acting as Technical Advisor to Oriental, whose 40% participation interest was approved by the Nigerian government on June 27, 2006. Addax is the Operator of the adjacent OML 123, currently producing in excess of 50,000 barrels of oil per day, and located immediately north of the Okwok Field. Oriental and Addax spudded their first appraisal well in the Okwok Field on July 1, 2006, three days after receiving Government and Farmor approval to commence drilling operations.

Alhaji (Dr.) Mohammed Indimi, Executive Chairman of Oriental, said "We are extremely pleased to have successfully concluded Phase One of the Okwok Field Appraisal Drilling Program, and to have tested light sweet crude oil in the main objective "Lower D Sand" reservoir sequence. While the drilling results so far indicate a complex petroleum system with a variety of crude oil gravities and significantly overpressured zones at shallow depth, the combination of light oil, high pressures, and the excellent quality reservoirs we have encountered thus far encourage us to believe that the Okwok Field has significant commercial potential. The objective of our next phase of appraisal drilling in 2007 will be to confirm sufficient oil reserves for fast track Okwok Field development, with the potential of first commercial oil production by early 2008. Our joint venture with Addax Petroleum, Nigeria's leading independent oil producer, is working well. We are especially pleased at having drilled four wells in only four months since Oriental received Government and Farmor approval to commence operations in the Okwok Field."

The Okwok Field was discovered and partially appraised by three wells (Okwok 1-3) drilled by a previous operator in 1967-68, but those wells were not production tested. Based on 3D seismic mapping the Okwok Field is subdivided into three main fault blocks, named Block 1, Block 2, and Block 3. The main reservoir objectives are a series of stacked Plio-Pleistocene age sandstones, known locally as the "Lower D Sands", that are found in Okwok Field at a drill depth of between 3,000 feet to 4,000 feet subsea.

The Oriental-Addax Okwok Phase One Drilling Program included the drilling of four wells using the GSF High Island IX drilling rig: the Okwok-4A and Okwok-4AST1 appraisal wells in Block 2, which contains the previously drilled Okwok-2 well, and the Okwok-7A and Okwok-8A in Block 3. The Okwok-4A encountered thinner than expected pay sands in multiple zones within the Lower D Sand interval, and was not flow tested. The Okwok-4AST1 encountered 95 feet of net oil pay in two intervals within the Lower D sand sequence and flowed 32 degree API gravity crude oil and minor amounts of gas during a cased-hole drill stem test, but the test was suspended during the initial flow period due to a mechanical failure of the sand exclusion screen in the perforated interval. A maximum 400 bopd rate was recorded. Block 3 had not been previously drilled, so the Okwok-7A and Okwok-8A were drilled as exploratory tests that confirmed 37 degree API gravity and 26 degree API gravity crude oil respectively in overpressured reservoir sands.

The overpressured reservoirs and unconsolidated sands encountered in the main objective intervals in both Block 2 and Block 3 presented significant challenges to the drilling and completion of these wells. Mechanical failures of the wireline and downhole test equipment occurred in the Okwok-4A and Okwok-4AST1 wells, and as a result it was not possible to accurately measure the net oil pay thickness of the Okwok-4A or to measure the true flow potential of the Okwok-4AST1. The Okwok-7A well encountered even higher overpressured sands in Block 3 than those seen in Block 2, and recovered forty-two barrels of 37 degree API gravity crude oil from the Lower D Sand interval before abnormally high pressures forced the plugging and abandonment of the well for mechanical reasons. The replacement well, Okwok-8A, logged 97 feet of Lower D Sand net oil pay in two zones, and the interval was gravelpacked as a sand control measure before being production tested. The Okwok 8-A flowed at the rate of 1,222 bopd of 26 degree API gravity from these zones, a different reservoir than that which flowed 37degree API gravity oil in the Okwok-7A well. Both the Okwok-4AST1 and the Okwok-8A wells are currently suspended as future production wells for eventual tie-back to production facilities.

Oriental and Addax are now in the process of incorporating the well data, oil properties and flow test data from the Phase One Exploration and Appraisal Program into their existing subsurface and engineering models. The new information will be used in the design of the 2007 Okwok work program which is expected to include further appraisal drilling and potentially fast-track development planning. Should the 2007 appraisal program be successful, the Okwok Field would likely be initially developed through the OML123 FPSO located 12 km to the north. First commercial oil production could commence by early 2008.

Oriental Energy Resources Limited is a privately held, Nigerian oil exploration and production company with its headquarters in Abuja, the Federal capital of Nigeria. In addition to the Okwok Field, Oriental is the Operator of OML 115, an Oil Mining Lease located near Okwok in southeastern offshore Nigeria. Oriental was assisted by Sovereign Oil & Gas Company II, LLC of Houston, Texas, in obtaining the farm-out from Mobil-NNPC and in arranging the farm-in with Addax Petroleum. Sovereign serves as Oriental's upstream advisor while it builds its internal capacity as a leading Nigerian independent oil operator.

Addax Petroleum is an international oil and gas exploration and production company focused on Africa and the Middle East. It is the largest independent oil producer in Nigeria and has increased its crude oil production from an average of 8,800 barrels per day for 1998 to approximately 83,000 barrels per day for the first eight months of 2006. In Nigeria, Addax Petroleum has a 100 percent interest in two Production Sharing Contracts for Blocks OML 123 (offshore), OML 124 (onshore), OML 126 and OPL 225 (offshore). The Okwok Field, which is located immediately south of OML 123, represents the first farm-in for Addax Petroleum in Nigeria.

Sovereign Oil & Gas Company II, LLC is a Houston-based international upstream project developer with world-wide experience specializing in West Africa. Sovereign has completed eleven major upstream property transactions in the Gulf of Guinea in recent years involving bonuses and work commitments in excess of US$400 million, with a focus on assisting local upstream asset owners in Nigeria obtain partners and financing.

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