EuroGas Settles Litigation and Resumes Operations

On August 24, 2007, EuroGas and related parties settled a long-standing litigation that had hindered its ability to conduct its oil and gas operations. The settlement enables EuroGas to resume its oil and gas exploration activities.

On October 8, 2007, EuroGas entered into an agreement with Ukrnaftogasinvest of Lviv, Ukraine, to mutually develop certain producing oil and gas interests located in the Carpathian Mountains of Western Ukraine, which are held by Ukrnaftogasinvest, a successful private company working in the oil & gas industry of Western Ukraine.

These oil and gas fields are partly developed and are currently producing oil and natural gas. Additional drilling -- to test deeper potentially oil and gas bearing structures -- is required in order to maximize production of these fields.

The fields are located in Western Ukraine, east of, but in the same favorable geological trend as, EuroGas' former oil and gas assets in Poland, which are now held by EuroGas Polska in Southeast Poland.