Coastal Energy Co.

Coastal Energy Co.

April 12, 2007 02:00 ET

Coastal Energy Company Announce Reserves Upgrade

LONDON, UNITED KINGDOM--(CCNMatthews - April 12, 2007) - Coastal Energy Company, (TSX VENTURE:CEO)(AIM:CEO) ("Coastal" or "the Company") an independent exploration and production company with core assets in South-East Asia, announces that Huddleston and Co. Inc. has completed its 2006 Competent Persons Report (the "Report") reserves evaluation in accordance with the TSX-V NI 51-101 regulations and the AIM Guidance Notes for Mining, Oil & Gas companies.

The Report highlights the following as at January 1, 2007:

- a 42% increase from January 1, 2006 in Coastal's Proven, Probable ("2P") reserves to 36.7 mmboe;

- a 55% increase from January 1, 2006 in Coastal's Proven, Probable and Possible ("3P") reserves to 45.3 mmboe; and

- Contingent resources of 177.1 mmboe net to Coastal (based on the high estimate).

In addition, the Company's overall gross 2P reserve estimate for the Phu Horm gas field has increased 72% from January 1, 2006 to 872 bcf.

The upgrade of reserves is based on additional technical information, including inter alia production data from the Phu Horm field and extensive reservoir simulations completed for the offshore fields which are currently under development. Reserve definitions are in accordance with the Society of Petroleum Engineers and the World Petroleum Congress "Oil and Gas Reserved Definitions".

Frank Inouye, Chief Executive Officer of Coastal Energy commented: "Over the past six months we have focused our efforts on commercialising the Company's onshore and offshore assets in Thailand and I am pleased to say our efforts have been reflected in the reserves upgrades. The Company's near term objective is concentrated on appraising and developing these assets in order to provide the cash flow that will enable us to identify and secure additional 'orphaned' opportunities."

- Additional information may be found on the Company's website, or may be found in documents filed on SEDAR,

Huddleston & Co., Inc., based in Houston, Texas, was founded in 1967 by B. P. Huddleston. The firm has developed into a premier provider of petroleum and geological engineering, consulting, and financial services. Huddleston & Co., Inc., has forged a solid reputation for consistently delivering a high quality work product as well as for utilizing the latest technological advancements to complete projects in a timely and cost effective manner. Additional information may be found at

Glossary of Industry Terms

Reserve Mineral and Ore - Probable and Proven reserves (or
equivalent depending on the Standard used).

Oil & Gas - Proved, Proved + Probable and Proved +
Probable + Possible reserves except when referring to
net present value calculations when reserves should
only include Proved and Proved + Probable reserves.

Resource Mineral and Ore - Inferred, Indicated and Measured
Resources (or equivalent depending on the Standard

Oil & Gas - Contingent and Prospective Resources.

Contingent Resource Those quantities of oil and gas estimated on a given
date to be potentially recoverable from known
accumulations but are not currently economic.

Proven Those reserves which on the available evidence are
virtually certain to be technically and economically
producible (i.e. having a better than 90% chance of
being produced).

Probable Those reserves which are not yet proven but which are
estimated to have a better than 50% chance of being
technically and economically producible. It is
equally likely that the actual remaining quantities
recovered will be greater or less than the sum of the
estimated proved + probable reserves.

Possible Those reserves which at present cannot be regarded as
'probable' but are estimated to have a significant
but less than 50% chance of being technically and
economically producible. It is unlikely that the
actual remaining quantities recovered will exceed the
sum of the estimated proved + probable + possible

2P Proved + Probable.

3P Proved + Probable + Possible.

mmboe Million Barrels Oil Equivalent.

bcf Billion cubic feet; 1 bcf equals 0.83 million tons of
oil equivalent.

These securities have not been registered under United States Securities Act of 1933 (the "US Securities Act") or the securities laws of any state and may not be offered or sold in the United States or to US persons (as defined in Regulation S under the US Securities Act) unless an exemption from registration is available.

Frank Inouye, President, CEO and Director of the Company, and a member of the American Association of Petroleum Geologists, has reviewed the contents of this announcement.

Certain statements contained in this announcement may constitute forward-looking statements. Such statements are generally identifiable by the terminology used, such as "plan", "anticipate", "expect", "budget" or other similar wording. Forward-looking statements include, but are not limited to, references to future capital and other expenditures, drilling plans or results, the submission of development plans, seismic activity, the existence and recoverability of potential hydrocarbon reserves, production amounts or revenues, operation costs, oil and gas price forecasts, results of exploration activities and dates by which certain areas may be developed or may come on-stream and environmental matters. These forward-looking statements are not guarantees of future results and are subject to known and unknown risks, uncertainties and other factors which may cause actual results, financial condition, performance and achievements to differ substantially from those express or implied by such forward-looking statements. Furthermore, the forward-looking statements contained in this announcement are made as of the date of this announcement, and Coastal Energy does not undertake any obligation to update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this release are expressly qualified by this cautionary statement.

Per barrel of oil equivalent ("boe") amounts have been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel of oil equivalent (6:1). The term boe may be misleading, particularly if used in isolation. A boe conversion ratio of 6mcf: 1bbl of oil is based upon an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Notes to Editors

- Coastal Energy (TSX VENTURE:CEO)(AIM:CEO) is an oil and gas exploration, development and production company, with core assets onshore and offshore Thailand

- Specialises in identifying and developing under-exploited or "orphaned" or assets. Management has proven experience at identifying and unlocking value from overlooked, abandoned, low risk assets with proven hydrocarbon potential

- This strategy has enabled the Company to assemble an asset base in Thailand that includes production of approximately 1,400(i) boepd of gas under long term contract and offshore oil fields currently under development

- Production growth over the next 12 -18 months is expected to grow exponentially and proven, probable and possible reserves are 45.3 million barrels oil equivalents

- Its current assets include:

- Offshore Thailand

- 100% of block G5/43 - 3 successful appraisal wells drilled in 2005 / 2 additional discoveries on the block awaiting appraisal / untested exploration potential on Songkhla Basin

- Onshore Thailand

- 12.6% working interest in blocks EU1 and E5N which include the Phu Horm gas field currently producing 100 mmcfd

- 36.1% interest in block L15/43 surrounding the Phu Horm field

- 36.1% interest in block L27/43 - containing the undeveloped Dong Mun gas field

- 21.7% interest in block L13/48 located adjacent to blocks L15/43 and L27/43, contains Si That discovery

- For additional information, including the complete CPR report, please visit the Company website,

(i) Gas converted at 6 mcf / barrel oil equivalent

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Coastal Energy Company
    Frank Inouye
    Chief Executive Officer
    +44 (0) 1483 549 549
    Canaccord Adams Limited
    Ryan Gaffney
    +44 (0) 20 7050 6777
    Bell Pottinger Corporate & Financial
    Ann-Marie Wilkinson / Nick Lambert / Rosanne Perry
    +44 (0) 20 7861 3232