Gobustan Completes First Well in Dashgil Field

Arawak Energy's affiliate, Gobustan Operating Company, has completed its first development well in the Dashgil field in Azerbaijan. Following clean up, a stable oil flow of approximately 300 barrels per day has been established through a 4 mm choke over a 24 hour period, with no water and a small amount of associated gas (a gas to oil ratio of 970 cubic feet per barrel). The well will undergo further testing prior to being put on production.

Gobustan Operating Company's second development well will also be drilled in the Dashgil field with oil as its primary objective, and is expected to spud on June 20th.

The acquisition phase of the 2D seismic program over the northernmost block of the three blocks which comprise the Southwest Gobustan concession area has also been completed this week, thereby fulfilling the Minimum Obligatory Work Program obligation with respect to seismic. Gobustan Operating Company has also completed its Minimum Obligatory Work Program obligations with respect to workovers. The interpretation of the seismic data will take approximately 2 months and should provide locations for exploration wells, to be drilled this year.

Gobustan Operating Company is the operating subsidiary for the development and production of the South West Gobustan fields covered under the Production Sharing Agreement with the State Oil Company of the Azerbaijan Republic (SOCAR), in which Commonwealth Gobustan Limited (CGL) has an 80% interest, with the remaining 20% held by SOCAR Oil Affiliate. ABG owns 37.17% of CGL and the balance is held by China National Petroleum Company (CNPC) group companies.