Empyrean: Final Shallow Drilling Program Begins at Project Margarita

According to Empyrean, the spudding follows the successful Project Margarita Initial Wells program on the El Viejito, Dos Dedos, and Milagro Prospects. The company will report on the progress of Agavero #1 when significant developments warrant.

The shallow prospects to be drilled in the Final Wells programs are again analogues of historic prolific Frio and Vicksburg sands production in the project area at <2,000 meters depth. The prospects with mean potential target outcomes and final well depths are summarized below.

Prospect       Potential       Total 
               Mean Reserves   Well Depth
Agavero        0.7 BCF         1,341 meters
Dona Carlota   0.8 BCF         1,524 meters
Climaco        1.6 BCF         1,981 meters

As with the successful Initial Wells program, tie in of any commercial discovery made on the prospects will be rapid as the project area is crossed by a number of gas pipelines with access rights and available capacity to tie into. As such the Final Wells program, inclusive of completions and production tie ins on successful wells, is currently expected to run until end of August 2007.

The final phase of the Margarita shallow drilling program is a precursor to commencement of a drilling program on an inventory of more substantial individual deep Cook Mountain Formation and Wilcox Formation, 30 to 200 BCF gas potential, prospects in the Project Margarita area. Conditional on Empyrean exercising its option on completion of the shallow Final Wells program the Deep Wells program could be underway late September quarter 2007.

Participants in the Margarita Project are:

• Empyrean Energy PLC, 44.00%
• Sun Resources NL 20.00%
• Victoria Petroleum NL, 20.00%
• Wandoo Energy LLC, 16.00%