Contact Exploration Inc.
TSX VENTURE : CEX

Contact Exploration Inc.

December 19, 2007 14:28 ET

Contact Announces Joint Venture Agreement for Hungarian Shallow Gas Exploration

CALGARY, ALBERTA--(Marketwire - Dec. 19, 2007) - Contact Exploration Inc. ("Contact") (TSX VENTURE:CEX) is pleased to announce that it has signed a Joint Venture Agreement with Toreador Hungary Ltd. (Toreador), for participation in the drilling of two exploratory wells and the acquisition of 170 square kilometers of 3-D seismic in their shallow gas Szolnok prospect.

The prospects are located in the 262,000 hectare Szolnok exploration license area in the east central part of Hungary. It is one of the largest exploration permits in Hungary and is adjacent to producing oil and gas fields. The block contains at least 10 already defined exploration targets in the shallow Pannonian and Miocene siliclastic formations. The first two wells, to be drilled in the first half of 2008, have depths ranging from 1400 metres to 2250 metres.

Contact will be a partner in the drilling of the two wells and in the acquisition of the seismic data paying 21.67% of the cost to earn a 16.25% interest in the block. The projected total cost for the two wells and seismic is EUR 6.5 million (C$9.4 million), with Contact's portion being EUR 1.4 million (C$2 million). There are multiple pipeline shipping options in close proximity to each of the proposed wells, with an attractive European pricing scenario for potentially produced hydrocarbons.

This project will be operated by Toreador's staff in Hungary, and Contact will provide technical expertise as needed. The Szolnok opportunity is very similar to Contact's operations in New Brunswick, especially in Stoney Creek, where overlooked shallow reserves and an attractive royalty structure are in close proximity to pipelines and refining capacity. It is Contact's objective to achieve significant reserve and production increases from a non-operated position by participating technically in an area that has not seen modern technology applied to exploration models or reservoirs. Toreador is a subsidiary of the NASDAQ listed Toreador Resources Corporation, which has operations in Turkey, Romania, Hungary and France.

While Contact's main operating focus will remain the exploitation and exploration of it's conventional Atlantic Canadian assets, Contact regards this Hungarian joint venture as an excellent opportunity for significant growth in production and reserves.

About Contact

Contact Exploration Inc. is a junior exploration company with a focus on Canadian East Coast onshore exploration & production. Contact's land claims and holdings are located in close proximity to the largest consumption markets in North America with pipeline and refinery infrastructure in place.

Contact has onshore interests in approximately 700,000 acres in Nova Scotia, approximately 160,000 acres in west Newfoundland and 165,000 acres in New Brunswick which includes the Stoney Creek Field (approximately 5500 acres), a field with estimated proved and probable reserves of 1.2 million barrels of oil and 6.5 bcf of natural gas. In addition to the Atlantic Canadian properties, Contact has producing oil assets in south eastern Saskatchewan and an interest in the Szolnok shallow gas project in east central Hungary.

Certain statements contained herein may constitute forward-looking statements. These statements relate to future events or our future performance. All statements other than statements of historical fact may be forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. We believe that the expectations reflected in the forward-looking statements are reasonable based upon management's current views but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. These statements speak only as of the date hereof. We do not intend, and do not assume any obligation, to update conclusions, forecasts or projections that may be contained in these forward-looking statements, whether as a result of new information, future events or otherwise. No assurance can be given that actual results, performance or achievement expressed in, or implied by these forward-looking statements will occur, or if they do, that any benefits may be derived from them. Past results have been applied in drawing a conclusion or making a forecast or projection set out in the forward-looking information.

Our actual results could differ materially from those anticipated in these forward-looking statements as a result of factors that may include, but are not limited to: the impact of government regulation, potential delays or changes in plans with respect to exploration and development projects, success of exploration and development activities, general industry and market conditions and other risks detailed from time to time in Contact's Annual Information Form and Management's Discussion and Analysis, both of which may be found at www.sedar.com.

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

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