Cabot Logs Pay at Redfish Bay Well

Cabot successfully drilled the State Tract 277 #2 well located in San Patricio County, Texas, to a total depth of 11,665 feet. This well is part of Cabot's Redfish Bay Frio play. The well was drilled by TODCO's inland barge, Rig 9. The well encountered 49 feet of Frio pay in two sands. The main pay interval is expected to be completed and turned in to sales in mid December at an anticipated rate of 15 Mmcfe per day. Current activity includes moving a rig in to drill an offset location. The Company has a 75 percent working interest in this project; Palace Exploration holds the remaining 25 percent.