PetroGlobe Inc.
TSX VENTURE : PGB

PetroGlobe Inc.

January 11, 2007 17:16 ET

PetroGlobe Updates Its Operations

CALGARY, ALBERTA--(CCNMatthews - Jan. 11, 2007) - PetroGlobe Inc. ("PetroGlobe") (TSX VENTURE:PGB) today released an update on its current operations and on corporate matters.

OPERATIONS

(a) Texas

PetroGlobe Energy USA Ltd. ("PetroGlobe Energy") plans to commence sale of gas from its McIntosh #1-77 well in the first quarter of 2007. Easements are being procured and arrangements are being made with a contractor for construction of a pipeline that will transport the gas to a tie-in point four miles south of the well site.

A four-point isochronal flow test carried out on the McIntosh #1-77 revealed an absolute open flow rate (AOF) capability measuring 3,316 MCF/Day. Results of the test have been submitted by PetroGlobe Energy to the Texas Railroad Commission.

Upon re-entering the well to conduct the test, it was determined that the equipment on site was unable to remove the plug. The plug was pierced to enable testing to proceed. The pressure in the well bore was equalized and the flow of gas was initiated. Cost efficiency dictated proceeding in the circumstances with knowledge that the flow rate would be affected by the partial obstruction. The plug was subsequently removed and thus will not affect future testing and production. PetroGlobe Energy plans to conduct further reservoir and deliverability tests on the McIntosh #1-77 well once production commences.

PetroGlobe Energy also completed tests on the deepest potential oil zone reached during drilling of its Young #1-32 well. The tests determined that this zone of the Young #1-32 is non-commercial in this well. Further testing of additional up-hole prospective zones is expected to resume when the necessary equipment becomes available.

Total depth was reached on the Cox #1-13 well on December 18, 2006, and the results are indeterminate at this time. The shale section will be evaluated for stimulation once a geologic evaluation of the well data has been completed.

Drilling is under way on the Ramsower #1-113 well, the fourth well in PetroGlobe Energy's initial program for the Palo Duro basin project. To date, drilling has reached 5400 feet of the projected target depth of 9,800 feet.

Plans are under way to build on last year's results with a continued drilling program in the Palo Duro basin in 2007.

PetroGlobe Energy recently opened an office in Midland, Texas, to assist with management of operations in West Texas.

(b) Alberta

Well completions have been executed on eight wells drilled in the Pembina area in November and December 2006, bringing PetroGlobe Inc.'s year-end well inventory in the area to 36, including one Leduc oil producer. However, warm weather and crew holiday shutdowns have continued to impede progress on pipeline tie-ins.

Pipeline crews are in the process of completing tie-ins for seven wells in the Warburg/Drayton Valley area, and five wells in the Cynthia area. An additional eight Pembina wells now are ready for tie-in and crews will commence connecting them upon completion of work on the Warburg/Drayton Valley and Cynthia wells. Once all of these wells are connected and able to ship gas, plans for optimization of the reservoirs will be completed taking into account current gas pricing scenarios.

PetroGlobe does not expect to be able to produce some of its well inventory at full capacity until approximately mid-year 2007 due to current short-term plant processing capacity constraints as a result of unavoidable delays to required infrastructure upgrades. Nonetheless, as part of a planned development program for the area, the corporation anticipates producing each well for a sufficient duration to enable well potential deliverability, reservoir parameters, optimum well densities and potential locations to be better defined.

CORPORATE

During the fourth quarter of 2007, the holders of 5,763,356 PetroGlobe Inc. warrants exercised their rights to surrender their warrant certificates and purchase new common shares of the corporation at the exercise price of $1.80 per share. This resulted in proceeds of Cdn.$10,374,041. PetroGlobe now has 32,654,604 issued and outstanding shares and 1,145,821 warrants remain in effect.

PERSONNEL

It is with regret that PetroGlobe Inc. announces that David Harris, a Director and Vice-President and Chief Financial Officer of the corporation, has elected to resign from the Board of Directors and to retire as an officer. His retirement follows a leave of absence taken for personal reasons which commenced in the fall of 2006. Mr. Harris was a founding member of PetroGlobe (Canada) Ltd., the international consulting company that preceded PetroGlobe Inc.'s founding and is now its subsidiary. He was also one of the first officers and directors of PetroGlobe Inc.

Clifford D. Johnson, Q.C., Chairman and Chief Executive Officer, said: "PetroGlobe, its employees and shareholders are indebted to Dave for his many years of dedication and service to the corporation and its subsidiaries. He worked tirelessly over the years to help build PetroGlobe to where it is today. On behalf of PetroGlobe and its Board of Directors, I would like to thank Dave for all his efforts and wish him all the best in his retirement."

Mike Walsh, currently Controller and acting Chief Financial Officer, has agreed to continue in this dual role for the next few months while PetroGlobe conducts a search for a permanent replacement for Mr. Harris.

ABOUT PETROGLOBE INC.

PetroGlobe Inc. is listed on the TSX Venture Exchange and trades under the symbol PGB. There are 32.7 million shares outstanding (35.8 million fully diluted). The 52-week range is $1.00 - $2.95. The market cap is $73.5 million based on a recent trade of $2.25.

PetroGlobe carries on business directly in Canada and indirectly in the United States through its wholly owned subsidiary PetroGlobe Energy USA Ltd. Another wholly owned subsidiary, PetroGlobe (Canada) Limited, is in the business of international oil and gas consulting.

Major properties are located in the Palo Duro Basin of West Texas and the Cynthia, Pembina and Leduc areas of West-Central Alberta.

This press release contains forward-looking information. Actual future results may differ materially from those contemplated.

This press release should not be construed to be a solicitation for the
purchase of the corporation's common shares.

Contact Information