Pan Orient Energy Corp.

Pan Orient Energy Corp.

March 30, 2006 10:29 ET

Pan Orient Provides Sawn Lake Test Results

CALGARY, ALBERTA--(CCNMatthews - March 30, 2006) -


Pan Orient Energy Corp. (TSX VENTURE:POE) ("Pan Orient") is pleased to announce it has been informed by the operator that the 1-36 Sawn Lake well (Pan Orient 10% W.I.) has cold produced at maximum estimated rates of between 150 to 200 barrels of oil per day.

Initial 1-36 fluid flow rates were quite low due to formation of a viscous drilling fluid emulsion in the well bore during the several month delay in arrival of a service rig for pump installation. Following dissipation of the emulsion, the well produced for an extended period including a 48 hour interval of maximum pump rate setting yielding estimated oil rates of 150 to 200 bbls/d, with total fluid rates limited at upper levels by pump capacity. Maximum estimated water production of up to 65 percent of total fluid volume was encountered. After discussions with the operator, Pan Orient believes the water may originate from either: 1) a fault encountered in the Blue Sky Formation below the casing shoe, or 2) an existing well 120 meters away from 1-36 that was drilled with water and total lost circulation through the Blue Sky formation resulting in a large, but limited water source. If either of these interpretations is correct, Pan Orient does not expect either to recur in future wells. Water samples are currently being analyzed and logs may be run to assist in the final determination of the source of the water. An initial oil sample taken early in the flow period has been analyzed and determined to be 10.79 API with 3.1% sulphur and a viscosity of 3,800cp at 25 degrees Celsius. Lab analysis of further oil samples should be available within the next week.

Operations at the well site are currently suspended due to the imposition of road restrictions which are anticipated to be lifted in mid-May. Upon the lifting of road restrictions, operations are expected to resume including a 3 well drilling program the operator expects to undertake in the summer of 2006. A total of 9 locations are expected to be drilled over the next several quarters.

Pan Orient President and CEO, Jeff Chisholm stated "We are very pleased with the initial results of the first Sawn Lake well confirming the cold flow potential of the reservoir and believe that further improved oil rates and reduced water rates may be achieved in future drilling that is driven by a complete reservoir model integrating seismic, aeromagnetic and well data."

In November 2004 Pan Orient commissioned a third party engineering evaluation of the 69.5 section Sawn Lake Heavy Oil Project (Pan Orient 10% W.I.) in accordance with the National Instrument 51-101, "Standards of Disclosure for Oil and Gas Activities" (NI 51-101) through AMJ Petroleum Consultants "AMJ". AMJ estimated a maximum of 1.2 billion barrels of original oil in-place (120 million barrels net to Pan Orient) with an estimated recovery factor of 8% resulting in 9.6 million barrels of potentially recoverable resources net to Pan Orient.

Pan Orient is a Calgary, Alberta based oil and gas exploration and production company with operations currently located onshore Thailand and Western Canada.

This news release contains forward-looking information. Forward-looking information is generally identifiable by the terminology used, such as "expect", "believe", "estimate, "should" "anticipate" and "potential" or other similar wording. Forward-looking information in this news release includes, but is not limited to, references to: sources of water production and expected future water production, lifting of road restrictions, well drilling programs and drilling plans, estimates of future oil in-place and potentially recoverable resources, and information on future production and project start-ups. By their very nature, the forward-looking statements contained in this news release require Pan Orient and its management to make assumptions that may not materialize or that may not be accurate. The forward-looking information contained in this news release is subject to known and unknown risks and uncertainties and other factors, which could cause actual results, expectations, achievements or performance to differ materially, including without limitation: imprecision of resource estimates and estimates of recoverable quantities of oil from resource plays, changes in project schedules, operating and reservoir performance, increased water production, the effects of weather and climate change, the results of exploration and development drilling and related activities, demand for oil and gas, commercial negotiations, other technical and economic factors or revisions and other factors, many of which are beyond the control of Pan Orient. Although Pan Orient believes that the expectations reflected in its forward-looking statements are reasonable, it can give no assurances that the expectations of any forward-looking statements will prove to be correct.

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

(27,681,973 common shares issued)

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Contact Information

  • Pan Orient Energy Corp.
    Jeff Chisholm
    President and CEO
    (403) 294-1770
    Pan Orient Energy Corp.
    Jason Bednar
    Vice President Finance and CFO
    (403) 294-1770