Rally Spuds New Salsabil Development Well in Pakistan

Rally Energy Corp. said that the Dewan-5 development well spudded on March 11, 2007, in the Salsabil development lease using a new Chinese rig ZP900. Total target depth is 3,200 meters, a depth sufficient to penetrate the productive Lower Goru sands and continue to the prospective Sembar and Chiltan formations. It is estimated that the well will take 65 days to reach total target depth and up to an additional 30 days of evaluation and testing, which may include stimulation.

Dewan-5 is the third well in the Salsabil field located on the Safed Koh concession in Pakistan where the Corporation's working interest is 30%. The Dewan-5 location is an offset to the Dewan-2 gas well, which production tested at rates of 10 MMCF/D, restricted by the size of tubing. The new Dewan-5 location is designed to allow maximum tubing size in the producing horizon Lower Goru Formation and in the prospective Sembar sandstones.

Rally also confirmed that the operator has advised that the project is on schedule for commencement of commercial gas production later on this month at an expected rate of 15 to 20 MMCF/D (net 4.5 to 6.0 MMCF/D) from two wells Dewan-1 and 2 increasing to 60 MMCF/D (net 18 MMCF/D) by July 2007 following the drilling and tie-in of the Dewan-5 development location.

Based in Calgary, Alberta, Canada, Rally Energy is an oil and gas exploration, development and production company. The Corporation's primary area of operation is in Egypt, where it has a 100% operating interest in the Issaran oilfield, a significant heavy oil development opportunity with strong growth potential. In Pakistan, the Corporation holds a 30% interest in the Safed Koh Block, where it is participating in the development of a large natural gas/condensate discovery.