Oilex Concludes Pendalian-3 Testing Program

Pendalian-3 - West Kampar PSC – Indonesia:

The Operator, Sumatera Persada Energi (SPE), says that the final drillstem swab test (DST) has been concluded at Pendalian-3 oil discovery. The preliminary evaluation of the data by SPE indicates that flow rates of up to 1, 200 barrels of oil per day (bopd) are likely when the well is brought into production with artificial lift, the conventional method of completion for these shallow wells. Analysis of the detailed data is in progress.

The test was conducted as a commingled flow over both of the zones tested previously in DST #3 and DST #4. This range of potential production flow rates is in general agreement with the rates achieved for each of those individual tests. The range of estimates of potential flow rates for DST #3 is 700-900 bopd and for DST #4, 400-650 bopd.

The results of the test program are very encouraging and the current best estimate of the resource, 12 million barrels of oil in place based on a single zone, will be revised when the proposed 3D seismic survey is acquired over the field.

The Joint Venture is now working to bring the well into production at the earliest opportunity. The immediate program is to prepare a development plan for the field that is likely to involve acquisition of a 3D seismic survey over the Pendalian structure and drilling of additional production wells in 2008.

DST #5 was conducted as a swab test over the shallowest interval and recovered a total of 98 barrels of mostly fresh water.

The Pendalian-3 well has been suspended as a future oil producer and the rig has been released.

Participants in the West Kampar Production Sharing Contract are:

Joint Venture Party                           Participating        
Oilex Ltd                                     45%                  
Sumatera Persada Energi (Operator)            55%