Cygam Energy Inc.
TSX VENTURE : CYG

Cygam Energy Inc.

October 31, 2005 09:00 ET

Cygam Energy Inc. Announces Signing of Agreement to Participate in New Project in Tunisia

CALGARY, ALBERTA--(CCNMatthews - Oct. 31, 2005) - Cygam Energy Inc. (TSX VENTURE:CYG) ("Cygam" or the "Corporation") is pleased to announce that it has signed a Farmin and Participation Agreement with Storm Ventures International Inc. ("Storm" or the "Operator") to acquire an interest in the Sud Remada Block, onshore Tunisia.

The Sud Remada Block encompasses 1,250,000 acres in southern Tunisia near the border with Libya. Main exploration targets are the Silurian Acacus Formation and the Ordovician Bir Ben Tartar and Hamra Formations. The Acacus Formation has been recently explored for in Southern Tunisia, in a block adjacent to Sud Remada, and several fields have been discovered in neighbouring Libya, in an area adjacent to the Tunisian border. Sandstone reservoirs in the Acacus sequence produce light oil in several new fields located south-west of the Sud Remada Block. The Ordovician fractured sands reservoirs have potential for both gas and condensate. Storm has acquired approximately 3,200 km of seismic in the Sud Remada block and is proposing a 3,100 meter well to test the Silurian and the Ordovician.

The Corporation has committed to participate with Storm for a 42% interest in the first well to earn a 28% working interest in the southern half of the block and has allowed a third party to participate for a 12% interest in the drilling of the commitment well to earn an 8% working interest. Cygam will also have an option to acquire a similar interest in the northern half of the block by participation in the drilling of a second earning well on the same terms.

The Operator estimates that the well will cost approximately US$4.00MM (dry hole) and US$5.2MM (completed). Storm has secured a drilling rig and expects to commence drilling operations around the middle of November. Storm is a private company with head offices in Calgary and with interests in Tunisia and the North Sea.

In conjunction with the Farmin and Participation Agreement signed with Storm, Cygam has offered an option to Storm to participate on the same earning terms as those of the Sud Remada block in one of the Corporation's licences in Italy (either the Civitaquana, or the BR 268, or an additional licence) where Cygam is the operator.

Cygam Energy Inc. is a Calgary based company with producing properties in Canada and several exploration licences in Italy and Tunisia. The main focus of the Corporation is to acquire licences and explore for oil and gas in Italy and Tunisia.

This News Release includes certain "forward-looking statements". All statements other than statements of historical fact, included in this release, including, without limitation, statements regarding future plans and objectives of Cygam Energy Inc., are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated or expected in such statements. Important factors that could cause actual results to differ materially from Cygam's expectations are risks detailed herein and from time to time in the continuous disclosure filings made by Cygam with securities regulators on the System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com.

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

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