Exall Energy Corporation
TSX : EE

Exall Energy Corporation

March 10, 2008 12:13 ET

Exall Announces Exceptional Flow Test on Oil Discovery

CALGARY, ALBERTA--(Marketwire - March 10, 2008) - Exall Energy Corporation (TSX:EE)("Exall" or the "Company") is pleased to announce preliminary production testing results from the previously announced Marten Mountain horizontal oil discovery (see Press release dated February 21, 2008):

- Extended test rate of 1,585 barrels of 40 degrees API sweet oil and 575 MCF of gas per day at 850 kPa flowing pressure (1,680 BOEPD)

- Average test rate once well was choked to 21.7 mm was 1,135 barrels and 475 MCF of gas per day (1,214 BOEPD)

- Equipping the well and road access construction is proceeding on schedule

- Second horizontal well and nearby vertical well planned for Q3

The well, located at 102/14-1-75-6W5, was rig released on February 23, 2008. On completion, the well flowed at an initial stabilized rate of 1,585 barrels of 40 degrees API sweet oil per day with associated solution gas of 575 MCFPD (1,680 BOEPD). The well flow rate was then restricted through a 21.7 mm choke due to a lack of adequate tankage and trucking from the site to handle the large volume of oil. The average flow rate during the 48 hour test period was 1,135 BOPD and 475 MCFPD. The produced oil had an average water cut of less than 1%.

The allowable production rate of the well, as prescribed by ERCB Regulations, is expected to be 285 BOPD (net 170 BOPD to Exall BPO and 190 BOPD APO). Exall expects that the well will be capable of long term production at this restricted rate. Exall is equipping the well for production into temporary facilities until break-up and evaluating permanent tie-in options. The Company is also pursuing water injection options which allow the well to produce at capacity under Good Production Practice.

Exall plans to drill a second horizontal well from the same surface location and a nearby vertical well as soon as surface access permits, which will likely be in the third quarter of 2008. Exall is the operator and holds a 59.338% working interest BPO and 66% APO in the well and a 66% WI in 6,080 acres of P&NG rights in lands surrounding the well. Exall is currently producing approximately 200 BOEPD and this discovery will have a significant impact on Exall's oil reserves, production, and cash flow.

Exall Energy Corporation is a Canadian junior energy company formed in November, 2006 and engaged in the exploration and development of oil and natural gas in Alberta, BC, Texas and the UK North Sea.

Please visit Exall Energy's website at: www.exall.com.



Glossary:

API: American Petroleum Institute ERCB: Energy Resources Control Board
MCF: Thousand Cubic Feet BPO: Before Payout
BOEPD: Barrels of Oil Equivalent APO: After Payout
Per Day BOPD: Barrels of Oil Per Day
WI: Working Interest kPa: Kilopascals
P&NG: Petroleum & Natural Gas


Contact Information

  • Exall Energy Corporation
    Stephen G. Roman
    Executive Chairman
    (416) 368-3949
    or
    Exall Energy Corporation
    Frank S. Rebeyka
    President and CEO
    (403) 815-6637
    Website: www.exall.com