GFI Oil & Gas Corporation
TSX VENTURE : GFI

GFI Oil & Gas Corporation

November 29, 2006 17:14 ET

GFI Oil & Gas Corporation: News Release

CALGARY, ALBERTA--(CCNMatthews - Nov. 29, 2006) -

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

GFI Oil & Gas Corporation (TSX VENTURE:GFI) ("GFI" or the "Company") announced today its September 30, 2006 first quarter results. A summary of first quarter highlights is included below and 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 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.

1Q Highlights

In the Company's first fiscal quarter ended September 30, 2006, GFI focused principally on implementing its development programs in Indonesia and Thailand, evaluating potential producing property acquisitions and raising capital.

Indonesia

In the Glagah Kambuna Technical Assistance Contract ("Glagah Kambuna TAC"), a 450 square kilometer 3-D seismic program commenced to delineate the ultimate size of Kambuna Field and to determine a possible location for the initial delineation well at the Glagah Oil Field. The seismic program is anticipated to be completed in early December 2006. The operator continues to implement the plan of development in order to achieve first production in early 2008. The next round of drilling of development wells is planned for the second and third calendar quarters of 2007.

In the Seruway Production Sharing Contract ("Seruway PSC") a 100 square kilometer 3-D seismic program is underway to delineate the location of the next development well at Gurname Field. The seismic program is expected to be completed in late December 2006. The operator anticipates drilling the sixth well in Gurname Field in the last half of calendar 2007.

Thailand

GFI has initiated negotiations on contracts for the platform, the floating production, storage and offloading vessel, ("FPSO") and the drilling rig to support activities for the Bualuang Field in 2007. First production is anticipated in the first quarter of 2008. Environmental permit applications for seismic, drilling of the fourth well in the Field and production facilities was submitted to government.

United States

The Company added an additional 20,000 acres to its lease holding now totaling 80,000 gross acres in the Crystal Gas Project during the quarter ended September 30, 2006. The Company anticipates finalizing the leasing program on the Crystal program prior to year end.

Acquisition Efforts

GFI continued its efforts to acquire properties with current production and development upside. First quarter efforts focused on Southeast Asia, South America and the Confederation of Independent States (CIS). Several significant potential acquisitions are being considered and the Company is conducting due diligence on the target properties.

Financing

On November 28, 2006 the Company closed a private placement of 65,023,293 GFI common shares at CAD $0.65 per share for gross proceeds of approximately $37,330,000 (CAD $42,265,140). The proceeds will be used to further develop its Indonesia and Thailand projects and for other working capital purposes.

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
    Alex T. Warmath
    Chief Executive Officer
    (281) 877-7940
    Email: awarmath@gfioil.com
    or
    GFI Oil & Gas Corporation
    12707 North Freeway, Suite 425
    Houston, TX 77060
    USA