GFI Oil & Gas Corporation
TSX VENTURE : GFI

GFI Oil & Gas Corporation

October 31, 2006 19:53 ET

GFI Oil & Gas Corporation: News Release

CALGARY, ALBERTA--(CCNMatthews - Oct. 31, 2006) -

This release is not for distribution to U.S. Newswire Services or for dissemination in the United States.

GFI Oil & Gas Corporation ("GFI" or the "Company") (TSX VENTURE:GFI) announced today its June 30, 2006 year end results. A summary of fiscal year 2006 highlights is included below and the full 2006 Consolidated Financial Statements and Management Discussion and Analysis are available at www.sedar.com and on the Company's website at www.gfioil.com.

GFI is an internationally focused oil and gas development company which targets previously discovered oil and gas fields that need further development known as "Greenfields".

The Greenfields strategy reduces the hydrocarbon discovery risk compared to early stage exploration projects.

Greenfields will have one or more previously drilled wells that have tested oil or gas at potentially economic quantities.

GFI's assets are currently located in Thailand, Indonesia and the United States.

In 2006, GFI focused on acquiring properties, drilling initial wells, implementing development programs and raising capital.

2006 Highlights

- Closed on farm-in of 25% interest in the Asahan PSC and the Glagah Kambuna TAC offshore Indonesia covering approximately 2,500 combined square kilometers in July 2005.

- Completed $6 million private placement with EnCap Investments in September 2005.

- Tested the Kambuna # 2 well at approximately 17 mmcfd and approximately 1,600 bcpd as a successful commercial delineation well in the Glagah Kambuna TAC in October 2005.

- Closed $17 million private placement including 18 institutional investors in Canada, Europe and USA in February 2006.

- Completed Reverse Takeover and formed GFI Oil & Gas Corporation and listed its shares on the TSX Venture Exchange in February 2006.

- Leased a significant acreage position (80,000 acres gross) in the Crystal Gas Project in the western United States in 1-3Q 2006.

- Purchased an additional 10% interest increasing total position to 35% Asahan and Glagah Kambuna licenses offshore Indonesia in March 2006.

- Concluded a farm-in of 35% of the Bualuang oil field in the Gulf of Thailand in April 2006.

- Concluded a 22.5% farm-in of the approximate 1.1 million acre Seruway license offshore Indonesia in June 2006.

- Booked net probable reserves of approximately 56.2 billion cubic feet of natural gas and 9.4 million barrels of oil and natural gas liquids net to the Company.

Planned 2007

Indonesia

3D seismic is currently being shot over a 400 square kilometer area including the Kambuna gas and condensate field and the Glagah oil field. Based on the new 3D data, locations of additional delineation wells will be determined. GFI anticipates drilling additional delineation wells in the second half of 2007. Construction and installation of the platform, pipeline and FPSO are planned for completion in 2007 with anticipated production beginning in 2008.

A 3D seismic program and delineation well is planned for the Gurname gas field in the Seruway PSC in 2007.

Geological evaluation is underway on a number of the other discovered Greenfields in the Seruway PSC.

Thailand

The Company is currently negotiating contracts for drilling, platform and FPSO in the Bualuang oil field which is anticipated to begin production in early 2008.

United States

Once land acquisition is complete the Company plans to begin developing the shallow gas Greenfield over the next two years depending on rig and equipment availability.

Financing

The Company is actively pursuing additional equity and debt capital in order to complete its current development program and continue to grow the Company.

Forward looking statements

Certain information regarding the Company herein may constitute forward-looking statements within the meaning of applicable securities laws. Forward-looking statements may include estimates, plans, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward looking statements. The Company's forward-looking statements are expressly qualified by this cautionary statement.


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

Contact Information

  • GFI Oil & Gas Corporation
    Mark N. Witt
    Chief Financial Officer
    (281) 877-7279
    Email: mark.witt@gfioil.com
    or
    GFI Oil & Gas Corporation
    12707 North Freeway, Suite 425
    Houston, TX 77060, USA