Calvalley Commissions CPF and Brings More Wells On Stream

Calvalley says its Central Processing Facility has been commissioned and crude oil production is currently flowing through the facility into a storage tank farm consisting of six 10,000 bbl tanks. It is anticipated that upon diverting all production from the temporary production facility to the CPF, the storage tanks from the temporary facility will be relocated to the Al Roidhat field. Following the relocation, it is anticipated that the Al Roidhat field will be put on to production and oil originating there from will be trucked to the CPF for processing.

In testing and completing the CPF, the Company has concurrently put three new wells onto production. Hiswah 5, 19 and Hiswah NE have come on-stream as the crude oil currently flowing through the CPF represents production that had not previously been included in the Company's overall production volumes.

Calvalley is continuing its negotiations with the Ministry of Oil and Minerals, third party operators and other related governmental regulatory bodies in an effort to finalize all outstanding matters closely linked to project economics, including issues relating to tariffs, crude quality adjustments, and other commercial factors. The Company believes that these outstanding issues could be of a critical nature in the future and must be addressed and agreed upon to secure Calvalley's long term interests in the Republic of Yemen. The pipeline is of importance to both Calvalley and Yemen, and as such the Company intends to meet with Ministry and Government officials in the upcoming days and weeks with the aim of addressing all of the Company's concerns. The Company is dedicated to forging a prosperous and successful partnership with the Yemeni Government both in this endeavor and in all future operations and projects in Yemen.

Calvalley is the operator of Block 9 in Yemen and holds a 50% interest in the block.