Well Testing Successfully Completed at Colombia's Gigante No. 2

Emerald Energy has provided the following update on well testing operations in the Gigante No.2 well in the Matambo Association Contract in Colombia.

The first flow testing operation in the Caballos formation has been successfully completed with 32 degree API oil flowing to surface, under natural flow, at a rate of approximately 185 barrels per day.

A flow test was conducted over a total perforated interval of 84 feet in the Caballos formation. Oil of approximately 32 degrees API gravity flowed to surface, under natural flow and through a 24/64 inch choke, at an average rate of 185 barrels per day over a 9 hour period with a water cut of approximately 3.5% which may have been the return of fluids lost to the formation during drilling operations.

An analysis of the pressure data acquired during the flow test indicates that formation damage has occurred during drilling. This data also indicates that the pressure in the Caballos formation has not been depleted by production from the Tetuan reservoir in the Gigante No.1A well.

The Company is now preparing to conduct a further flow test of the Caballos formation using an electrical submersible pump, a method of artificial lift currently used for production in the Gigante No.1A well.

The Caballos formation is the exploration target in the Gigante No.2 well, underlying the Tetuan formation which is the producing reservoir in the Gigante No.1A well and the development target in the Gigante No.2 well. The Caballos formation was encountered approximately 338 feet structurally higher in the Gigante No.2 well than in the Gigante No.1A well.

Emerald's Chief Executive Officer, Angus MacAskill, said, "We are delighted to have demonstrated that the Caballos formation, the exploration target in this well, is oil bearing and look forward to the results of further testing of this formation before proceeding to the flow testing of the Tetuan reservoir."