Jadela Oil Corp.

November 21, 2011 15:01 ET

Jadela's Eagle Ford El Indio #1-H Update

CALGARY, ALBERTA--(Marketwire - Nov. 21, 2011) - Jadela Oil Corp. ("Jadela" or the "Company") (TSX VENTURE:JOC) wishes to announce an update to its press release dated September 7, 2011. On September 7, 2011, the Company announced testing results from its El Indio #1-H, a 2,400 foot (731 meters), 8 stage Eagle Ford formation horizontal well on its property located in Maverick County, Texas.

There have been a series of events which started with technical issues with stage 1 and the sand-off during stage 2 of the fracturing process which has resulted in operational delays and cost overruns.

As of September 15, 2011, from 281 flowing hours (11.7 flowing days), the well produced 2,077 barrels of oil (175 bopd based on flowing hours)(40-45 degree API) and 22.394 mmscf of gas (319 boepd based on flowing hours), primarily from 6 of the 8 stages which were effectively fractured. As of September 15, 2011, of the 5,360 barrels of liquid propane/butane which were injected into the formation to fracture the well, only 21% (1,143 barrels) were recovered.

On September 16, 2011, the well was shut in to insert production tubing. When the well was swabbed, a downhole emulsion was discovered. Tests were then run to determine how to break the emulsion and a breaker was run into the wellbore on October 24-26, 2011. A pump jack was installed on November 9, 2011. Based on the oil produced, it would appear as though the breaker was successful. A three stage separator has been installed and should be operational on November 21, 2011. Management believes that the current test data is, and will continue to be, incomplete until fluid levels stabilize, gas/oil ratios can be determined, more propane can be recovered and Jadela establishes optimum pump efficiency. Jadela estimates that it may take a minimum of 30 days to stabilize pump rates. The permanent treatment battery site located on the gas transmission pipeline has been constructed. Permits have also been obtained to permit pipeline construction from the wellsite to the permanent battery site.

About Jadela

Jadela is a junior oil and gas exploration company. For additional details, please visit Jadela's website at www.jadelaoil.com.

Reader Advisory

Except for statements of historical fact, this news release contains certain "forward-looking information" within the meaning of applicable securities law. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. In particular, forward-looking information in this press release includes, but is not limited to, statements with respect to the timing and completion of the recovery of propane/butane, anticipated or expected production rates, timing related to the construction of the tie-in pipeline and future oil and propane recovery rates. Although we believe that the expectations reflected in the forward-looking information are reasonable, there can be no assurance that such expectations will prove to be correct. We cannot guarantee future results, performance or achievements. Consequently, there is no representation that the actual results achieved will be the same, in whole or in part, as those set out in the forward-looking information.

Forward-looking information is based on the opinions and estimates of management at the date the statements are made and are founded on the basis of expectations and assumptions made by the Company. Such forward-looking information is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking information. Some of the risks and other factors that could cause the results to differ materially from those expressed in the forward-looking information include, but are not limited to: general economic conditions in Canada, the United States and globally; industry conditions, including fluctuations in the prices of oil and natural gas; governmental regulation of the oil and gas industry, including environmental regulation; unanticipated operating events or performance which can reduce production or cause production to be shut in or delayed; failure to obtain industry partner and other third party consents and approvals, if and when required; competition for and/or inability to retain drilling rigs and other services; the availability of capital on acceptable terms; the need to obtain required approvals from regulatory authorities; stock market volatility; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; competition for, among other things, capital, acquisitions of reserves, undeveloped lands, skilled personnel and supplies; incorrect assessments of the value of acquisitions; geological, technical, drilling, processing and transportation problems; changes in tax laws and incentive programs relating to the oil and gas industry; failure to realize the anticipated benefits of acquisitions and dispositions; and other factors. Readers are cautioned that this list of risk factors should not be construed as exhaustive.

The forward-looking information contained in this news release is expressly qualified by this cautionary statement. We undertake no duty to update any of the forward-looking information to conform such information to actual results or to changes in our expectations except as otherwise required by applicable securities legislation. Readers are cautioned not to place undue reliance on forward-looking information.

Disclosure provided herein in respect of boes may be misleading, particularly if used in isolation. A boe conversion ratio of 6 mcf:1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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