Hoang Long Joint Operating Spins Bit Offshore Vietnam

The Company has been informed by the Hoang Long Joint Operating Company, Operator of Block 16-1 in the Cuu Long Basin offshore Vietnam, that the jackup drilling rig PV Drilling I, owned and operated by PV Drilling, has been secured to commence the first phase of the Te Giac Trang ('TGT') Field development and appraisal well drilling program. The contract commitment is for seven wells with four six month extension options. The first well is scheduled to spud in mid August after the Phase 1 platform jacket and drilling deck have been installed. These units have now been loaded out onto barges and will be installed offshore over the next few weeks. The first phase of the development drilling program will be continuous.

First oil from the TGTField is targeted for mid-2011 with production from this first phase of development expected to be approximately 50,000 barrels of oil per day ('BOPD').

Drilling of the Te Giac Den ('TGD') 2X appraisal well is continuing. The well is currently at approximately 3,761 meters and is setting an intermediate casing string. With the difficulties encountered in the prior TGD drilling campaign and with safety being the paramount concern, this well has been designed with a very fundamental "belt and braces" approach. The well is now expected to reach total depth in mid-August.

The Ca Ngu Vang ('CNV') Field is currently producing at approximately 11,000 barrels of oil equivalent per day ('BOEPD'), comprised of 7,500 BOPD and 20 million standard cubic feet of gas and gas liquids per day. The reservoir has reacted very well to the pressure maintenance program initiated with the completion of the first water injector well drilled earlier this year. The Hoan Vu Joint Operating Company, operator of the CNV Field, is now considering drilling an additional producing well in Q4 2010 or Q2 2011 which would eventually be converted to a water injector.

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