Gold Oil: South American Drilling

Gold Oil Chairman Michael Burchell reported that obtaining approval for exploration and drilling in Peru and Colombia has become an extremely lengthy procedure. As a result, Gold Oil's plans for well re-entry in Burdine, Colombia, expected to be carried out in 2007, have been pushed back to 2008. Operations at the Rosa Blanca exploration well have also been delayed into 2008.

An environmental survey in Peru's offshore block Z34 is complete and needs only government approval to acquire seismic data.

With valid environmental permits for wells on Block XXI onshore Peru, Gold Oil plans to drill a well near San Alberto-1X and more in the southern portion of the block.

For 2008 Burchell predicts the drilling of up to three new wells in Block XXI, participations in four re-entries in Colombia, at least one exploration well, and Nancy production to increase with the arrival of a new surface pump.