OILEXCO INCORPORATED
AIM : OIL
TSX : OIL

OILEXCO INCORPORATED

May 30, 2006 17:16 ET

Oilexco Incorporated: Drilling Results for Halibut Prospect

CALGARY, ALBERTA--(CCNMatthews - May 30, 2006) - Oilexco Incorporated ("Oilexco") (TSX:OIL) (AIM:OIL) and Faroe Petroleum ("Faroe") (AIM:FPM.L) announce that drilling results for the well at the Halibut prospect located in Blocks 14/21a and 14/22a in the UK Central North Sea indicate that there are no commercial quantities of hydrocarbons present. The well is being plugged and abandoned. The well was drilled by Dolphin Drilling's semi-submersible Bredford Dolphin to a depth of 3,692 feet, and was targeting upper Jurassic Sandstones, with secondary targets in Lower Cretaceous Sandstones. Oilexco paid 80% of the drilling and historic survey costs to earn a 55% interest in the blocks.

"While we didn't achieve the results we were hoping for at Halibut, the well was drilled very quickly and very inexpensively, so the costs for this prospect were very low", said Oilexco President and CEO Arthur Millholland. "We have the Transocean Sedco 712 semi-submersible under contract until 2010, and plan to drill several wells during this time. The Sedco 712 is fully committed for the remainder of 2006, including a development well in our Nicol Field, appraisal work at our recently announced Disraeli find, and appraisal drilling on our Shelley and Kildare prospects to name a few."

Forward Looking Statements

This disclosure contains certain forward-looking statements that involve substantial known and unknown risks and uncertainties, certain of which are beyond Oilexco's control, including: the impact of general economic conditions in the areas in which Oilexco operates, civil unrest, industry conditions, changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in commodity prices, foreign exchange or interest rates, stock market volatility and obtaining required approvals of regulatory authorities. In addition there are risks and uncertainties associated with oil and gas operations, therefore Oilexco's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements will transpire or occur, or if any of them do so, what benefits, including the amounts of proceeds, which Oilexco will derive therefrom. All statements included in this press release that address activities, events or developments that Oilexco expects, believes or anticipates will or may occur in the future are forward-looking statements. These statements include future production rates, completion and production timetables and costs to complete wells, and production facilities. These statements are based on assumptions made by Oilexco based on its experience perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances.

Oilexco is listed on the Alternative Investment Market of the London Stock Exchange plc and the Toronto Stock Exchange, in each case trading under the symbol OIL.

Contact Information

  • Oilexco Incorporated
    Arthur S. Millholland
    President
    (403) 262-5441
    or
    Oilexco Incorporated
    Brian L. Ward
    Chief Financial Officer
    (403) 262-5441
    or
    Oilexco Incorporated
    Gerry L. Roe
    Chief Operating Officer
    (403) 262-5441
    or
    Oilexco Incorporated
    Rob Elgie
    Manager Investor Relations
    (403) 262-5441
    Website: www.oilexco.com