Cygam Energy Inc.
TSX VENTURE : CYG

Cygam Energy Inc.

January 31, 2006 12:06 ET

Cygam Energy Inc. Receives New Exploration Permit

CALGARY, ALBERTA--(CCNMatthews - Jan. 31, 2006) - Cygam Energy Inc. (TSX VENTURE:CYG) ("Cygam") is pleased to announce that its wholly-owned subsidiary, Vega Oil S.p.A. ("Vega"), has received preliminary ministerial approval for a new exploration permit in the Mediterranean Sea, offshore south-eastern Sicily. Vega has a 100% working interest in this permit and has already received expressions of interest from other companies willing to participate in exploratory activities in the area.

The d348 C.R.-VG (Aretusa) permit is located in the Ragusa Plateau and encompasses an area of 83,264 acres. Available seismic data indicates the presence of two potential structures on the block. The main hydrocarbon target is the "Taormina" carbonate unit of upper Triassic age; a secondary target is represented by the "Inici" carbonates of lower Jurassic age. Several significant oil fields have been discovered in Triassic and Jurassic carbonates onshore and offshore Sicily since 1954.

Vega is currently preparing an environmental assessment report which will be submitted to the Ministry of Environment. Reprocessing of existing seismic data and acquisition of additional seismic lines will follow after final ministerial approval is granted. Aretusa is the fifth area in Italy in which Vega has obtained an exploratory permit.

Cygam is also pleased to announce that its other wholly-owned subsidiary, Rigo Oil Tunisia ("Rigo"), recently opened an office in Tunis as required by its operator's duties under Tunisian guidelines. Rigo operates two large permits, the Jorf and Sud Tozeur blocks, and has earned a net 20% working interest in the Remada Sud permit in Tunisia. Interpretation and reprocessing of extensive seismic data is currently being carried out in Calgary on the Jorf and Sud Tozeur permits; the drilling obligation on the Jorf block will be evaluated and an exploratory well may be proposed by mid 2006.

In Canada, completion of the 9-19-50-16 W5M well in the South Edson gas unit has been temporarily postponed due to service rig unavailability. It is now expected that completion operations will commence in early February.

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 interpretation of seismic data, 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. The existence of discoveries in structures and formations in the regions where Cygam has permits does not necessarily assure that the company will be successful. 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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