Caspian: Zhagabulak #303 Reaches Total Depth

Caspian Energy Inc, an oil and gas exploration company operating in Kazakhstan, on Wednesday announced that Aral Petroleum Capital LLP (in which the company holds a 50% indirect interest) has finished drilling its third exploration well, Zhagabulak #303, to a total depth of 4630 meters. The well encountered approximately 70 meters of net pay in Middle Carboniferous reservoirs. It will be tested after stimulation, and we anticipate this will be by the end of the first quarter.

Aral has finished a workover of the producing well, East Zhagabulak #213 to remove an obstruction in the tubing, add perforations and acidize the well. The lower zones were acidized, but the upper zones were not due to casing problems. The well is being flowed to the production facility and is producing oil and acid water. While the well continues to clean up the production is unstable, but is showing improvement.

East Zhagabulak #301 is shut in while operations are underway to retrieve wire line and logging tools from the well, which were dropped in the hole when the wire line parted during production testing operations.

East Zhagabulak #302 was re-acidized and no improvement was seen. This well is shut in.

Charles Summers, Chief Operations Officer, Caspian Energy, Inc. commented:

"Zhagabulak #303 was drilled to the Devonian at 5430 m, in the original hole, but unfortunately the rig's surface equipment parted and dropped the drill string. This resulted in the loss of the original hole. The well was cleaned out below the last casing setting depth and then sidetracked. Though hydrocarbon indications were present, in the Devonian, the sidetrack was not drilled to the Devonian as the risk and delay to our drilling program is not acceptable. We were not able to stimulate the entire perforated section in well #213, due to the multiple weights and grades of casing in the well and the resulting packer limitations but we have good results form the intervals that we have been able to stimulate. Production is still unstable, due to the well lifting spent acid water but we expect it to stabilize in the next several days,

"I am also pleased to announce that Edgar Folmar has accepted the position of Director of Operations for Aral Petroleum Capital. Edgar has over 20 years of experience in oil and gas operations, and over 13 years in Kazakhstan most recently with Shell as Technical Manager for their Kazakhstan operations."