Loon Energy Inc.
TSX VENTURE : LEY

Loon Energy Inc.

December 03, 2007 18:51 ET

Loon Energy Inc.: Syria Contract Becomes Effective

CALGARY, ALBERTA--(Marketwire - Dec. 3, 2007) - Loon Energy Inc. ("Loon" or the "Company") (TSX VENTURE:LEY) is pleased to announce that the parliamentary ratification of the Contract for the Exploration, Development and Production of Petroleum ("PSC") with the Government of the Syrian Arab Republic, represented by the Ministry of Petroleum and Mineral Resources ("Ministry") and the Syrian Petroleum Company ("SPC") for Block 9, was accepted and signed by the President of Syria. The Block 9 PSC has come into effect under Law 27 with an effective date of November 29th 2007.

Loon originally announced its award of the exclusive right to negotiate a PSC covering Block 9 on June 1, 2006 and the recent ratification was the culmination of a lengthy process of negotiation that followed the original award. As part of the signing process, Loon has posted a bank guarantee of US$7.5 million.

Block 9 is a large and under-explored area of more than 10,000 km2 located at the northern edge of a hydrocarbon-producing basin called the Homs Basin which contains the large Palmyra, Cherrife Da and Ash Shaer fields.

Under the terms of the Block 9 PSC, Loon has a first phase exploration period of four years during which it has committed to acquire 600 kilometres of 2D seismic and drill two exploration wells. The exploration period can be extended for up to nine years in phases by performing additional work on an agreed basis.

Loon has a 100% interest and is the operator of Block 9. ANSCO Inc., subject to the approval of the Ministry and SPC, has the right to acquire a 5% working interest in Block 9 on a heads-up basis.

Loon is an international oil and gas exploration and production company having direct interests in Brunei, Syria, Colombia, Peru, Tunisia and Slovenia and exposure to a major exploration and development program in Pakistan through its shareholding interest in Jura Energy Corporation. Loon has offices in Calgary, Alberta, Canada, Dubai, United Arab Emirates and Bandar Seri Begawan, Brunei Darussalam. For further information, please refer to the Loon website (www.loon-energy.com) or contact the following:

Some of the statements contained in this release may be forward-looking statements. Forward-looking statements may include, but are not limited to, statements concerning estimates of recoverable hydrocarbons, expected hydrocarbon prices, expected costs, statements relating to the continued advancement of the Company's projects and other statements which are not historical facts. When used in this document, and in other published information of the Company, the words such as "could," "estimate," "expect," "intend," "may," "potential," "should," and similar expressions are indicative of a forward-looking statement. Although the Company believes that its expectations reflected in the forward-looking statements are reasonable, the potential results suggested by such statements involve risk and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Various factors, which could cause actual results to differ from these forward-looking statements, include the potential that the Company's projects will experience technical and mechanical problems, geological conditions in the reservoir which may negatively impact levels of oil and gas production and changes in product prices and other risks not anticipated by the Company or disclosed in the Company's published material. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties.

The TSX Venture Exchange neither approves nor disapproves of the information contained herein.

Contact Information