Loon Energy Inc.
TSX VENTURE : LEY

Loon Energy Inc.

May 12, 2006 09:15 ET

Loon Energy Inc.: Deepening of the D14 Well

CALGARY, ALBERTA--(CCNMatthews - May 12, 2006) - Loon Energy Inc. ("Loon") (TSX VENTURE:LEY) announces that in April 2006 work commenced on the D14 well in the Dolina field area in Slovenia. The well was deepened by approximately 100 metres to 2,914 metres. The well drilled through the E1 sand in the Petisovci-Globoki (Pg) reservoir which was the main target of the well. The well was logged and the logs for the E1 sand correlated well with the E1 sand in the Pg 5 well which has produced significant quantities of gas in the Petisovci field area after fracture stimulation.

The D14 well did not flow meaningful quantities of gas during an open hole test and the well has been suspended for further evaluation by Loon and Nemmoco Slovenia Corporation ("Nemmoco").

The D-14 well is subject to a farmout agreement with Grove Energy Limited ("Grove") and was drilled at no cost to Loon. Grove has elected to not participate in the further evaluation of the D-14 well and consequently any future work will be undertaken on a sole-risk basis by Loon and Nemmoco.

Some of the statements contained in this release may be forward-looking statements. Forward-looking statements may include, but are not limited to, statements concerning estimates of recoverable hydrocarbons, expected hydrocarbon prices, expected costs, statements relating to the continued advancement of the Company's projects and other statements which are not historical facts. When used in this document, and in other published information of the Company, the words such as "could," "estimate," "expect," "intend," "may," "potential," "should," and similar expressions are indicative of a forward-looking statement. Although the Company believes that its expectations reflected in the forward-looking statements are reasonable, the potential results suggested by such statements involve risk and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Various factors, which could cause actual results to differ from these forward-looking statements, include the potential that the Company's projects will experience technical and mechanical problems, geological conditions in the reservoir which may negatively impact levels of oil and gas production and changes in product prices and other risks not anticipated by the Company or disclosed in the Company's published material. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties.



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Contact Information

  • Loon Energy Inc. (Calgary)
    Norman W. Holton
    (403) 264-8877
    or
    Loon Energy Inc. (Dubai)
    Timothy M. Elliott
    +971-4-339-5212
    or
    Loon Energy Inc. (Dubai)
    Jock M. Graham
    +971-4-339-5212