Chamaelo Exploration Ltd.
TSX : CXN

Chamaelo Exploration Ltd.

October 12, 2005 06:00 ET

Chamaelo Commences Drilling and Provides Operational Update

CALGARY, ALBERTA--(CCNMatthews - Oct. 12, 2005) - Chamaelo Exploration Ltd. (TSX:CXN) ("Chamaelo") is pleased to announce it has commenced a 22 well drilling program and continues to add production and productive capacity through recompletions and re-activations as highlighted below:

- Current production increased to 1,200 boepd (65% gas) from 1,000 boepd at inception

- 400 boepd of gas production awaiting pipeline tie-ins after a successful recompletion and re-activation program

- Drilled and cased the first of 22 wells scheduled for Q4/05 and early Q1/06

- Production expected to exceed 2,000 boepd (75% gas) by late January 2006

The drilling program will include 15 shallow wells targeting Belly River, Viking and Upper Mannville gas targets primarily in West Central Alberta. This group of wells includes a combination of development and low-risk exploration with an average working interest of approximately 65%. Productivity of such wells in the area can vary from 30 to 150 boepd, with an expected sustained rate averaging 50 boepd per well.

The program will also include 7 wells targeting deeper more prolific targets in West Central Alberta and Northeast British Columbia. This group of wells is higher risk exploration with an average working interest of approximately 63%. Productivity of such wells in the area can vary from 150 to 1,500 boepd with an average prospect being 250 boepd.

Chamaelo has recently completed the reprocessing of a significant seismic data set that was previously acquired and has also purchased trade data to enable it to continue to add exploration and development locations on its large undeveloped land base.

Based on development locations added from the current drilling program and additional exploration locations to be added from seismic, we anticipate having material capital expenditures and production additions in 2006. Chamaelo will provide its 2006 guidance in early December 2005.

FORWARD LOOKING STATEMENTS

This Press Release may contain forward-looking information that involve a number of risks and uncertainties that could cause actual results to differ materially from those anticipated. For this purpose, any statements herein that are not statements of historical fact may be deemed to be forward-looking statements. Such risks and uncertainties include, but are not limited to: risks associated with the oil and gas industry (e.g. - operational risks in exploration, development and production; changes and/or delays in the development of capital assets; uncertainty of reserve estimates; uncertainty of estimates and projections relating to production and costs; commodity price fluctuations; environmental risks; and industry competition).

Contact Information

  • CHAMAELO EXPLORATION LTD.
    Robert J. Zakresky
    President
    (403) 705-3006
    or
    CHAMAELO EXPLORATION LTD.
    Nolan Chicoine
    Vice President Finance
    (403) 705-3022
    or
    CHAMAELO EXPLORATION LTD.
    700, 639 -5th Ave SW
    Calgary, Alberta T2P 0M9
    (403) 705-3135
    (403) 705-3130 (FAX)
    Website: www.chamaelo.ca