Cinch Energy Corp.
TSX : CNH

Cinch Energy Corp.

January 10, 2007 23:59 ET

Cinch Energy Corp. Updates Year End Operations

CALGARY, ALBERTA--(Marketwire - Jan. 10) - Cinch Energy Corp. (TSX:CNH)("Cinch" or "the Company") is pleased to report that it has met its projected 2006 production exit rate at approximately 1600 BOE/d. During the month of December, the Company was successful in tieing in two new wells in its core Chime/Kakwa area. The Kakwa 13-13 gas well, in which the Company holds a 50% interest, commenced production at an initial rate of approximately 1.7 mmcf/d and the Chime 12-6 gas well, in which the Company holds a 50% interest, commenced production at an initial rate of approximately 1 mmcf/d. It is anticipated that these wells will experience typical Deep Basin decline rates in their first year of production.

Cinch continues to have exploration success in its core areas. At Chime East, the Smoky 12-24 well, in which the Company holds a 45% interest, was successfully completed as a gas well. The well is currently being production tested and evaluated for tie in. Cinch holds a 45% interest in 11 sections of undeveloped land offsetting this well.

At Kakwa East, the Kakwa 15-12 well, in which the Company holds a 50% interest before payout of costs, reached total depth of 3231 metres. The well is being cased to total depth as a potential dual zone oil and gas well. It is anticipated that completion operations will commence in two weeks. Cinch holds interests ranging from 30% to 50% in 4 additional sections of undeveloped land offsetting this well.

At Pouce Coupe, the Doe 2-24 well, in which the Company holds a 40% interest, has been completed as an oil well. The well is scheduled to commence production within two weeks.

The Company is currently surveying a location at Chime 14-6-61-5W6. This exploration location will offset a significant gas discovery, which commenced production in June 2006 from the Falher B zone, and has been producing at 25 mmcf/d during the months of October and November as per publicly available information. Cinch expects to hold a 40% interest in this location which is projected to commence drilling in the latter portion of February.

Cinch remains positive about the long term future in natural gas prices and the exploration potential in its core areas.

Barrel of Oil Equivalency

Natural gas volumes contained herein are converted to barrels of oil equivalent (BOE) on the basis of six thousand cubic feet (mcf) of gas to one barrel (bbl) of oil. The term "barrels of oil equivalent" may be misleading, particularly if used in isolation. A BOE conversion ratio of six mcf to one bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Forward Looking Statements

Statements throughout this release that are not historical facts may be considered to be "forward looking statements". These forward looking statements sometimes include words to the effect that management believes or expects a stated condition or result. All estimates and statements that describe the Company's objectives, goals, or future plans are forward looking statements, including management's assessment that future plans and operations, wells to be drilled, timing of drilling of wells, and commencement of completion operations and production from certain wells, and the timing thereof. Since forward looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to any number of factors, including risks associated with oil and gas exploration, completions, production and related declines, environmental risks, competition from other producers, inability to retain drilling rigs and other services, delays resulting from or inability to obtain required regulatory approvals and the ability to access sufficient capital from internal and external sources. Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect the Company's operations and financial results is included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com), and at the Company's website (www.cinchenergy.com). Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.

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