PetroGlobe Inc.
TSX VENTURE : PGB

PetroGlobe Inc.

October 20, 2005 09:00 ET

PetroGlobe Inc. Announces a Private Placement and Latest Update

CALGARY, ALBERTA--(CCNMatthews - Oct. 20, 2005) - PetroGlobe Inc. (TSX VENTURE:PGB) announced today that it is undertaking a non-brokered private placement of equity shares at a price of $1.50 per share with a minimum subscription level of $5,000. The offering will raise up to $9,000,000. There will be a 1/2 warrant issued for each common share exercisable in 12 months at $2.20 per common share and 18 months at $2.50 per common share.

PetroGlobe Inc. Board of Directors has approved the private placement. To the best of our knowledge, no new control persons will be created as a result of the private placement, and no other material changes will take place.

The sale of the common shares will be completed at the corporation office at a date that the subscribers and corporation may agreed upon and is conditional upon acceptance of the TSX Venture Exchange. There will be an initial hold period of four (4) months on the resale of the shares.

PetroGlobe Inc. will use the proceeds of this sale of equity common shares to complete the financing of the Company's acreage acquisition program in the Palo Duro Basin in the Floyd, Swisher and Hale Counties in West Texas, to provide funding to start the drilling of evaluation wells on these prospective lands and for general corporate purposes.

As of October 14th, PetroGlobe had acquired leases of 100,000 gross acres and is actively working on the acquisition of an additional 15,000 acres. The Company has a 55% working interest in the acquired acreage and will be the Operator. The net acreage position for PetroGlobe, including the Vintage AMI (Area of Mutual Interest), is approaching 60,000 acres in the Palo Duro Basin. The PetroGlobe consortium is now the third largest landholder in the Palo Duro Basin. The Company's current plan is to identify locations and source a rig to commence drilling to validate the Company's land holdings in Texas.

In Central Alberta, PetroGlobe will commence its drilling program of the initial 13 wells starting this week, weather permitting. Completions and well tie-ins will follow shortly. The Company fully expects to start production prior to year-end. There are 25 additional drilling locations identified in the Pembina area and several in the Cynthia area to be drilled during the remainder of this year and into early 2006. In addition to the 6 contiguous townships, PetroGlobe is pursuing other farm-in opportunities in the same general area.

PetroGlobe, earlier in the year participated in a Nisku test at 100/03-25-046-15W5 operated by Blaze Energy Ltd. The well went on stream at 3.0 MMCF/D on October 3rd. PetroGlobe has a net working interest of 2.5% in the well.

This press release should not be construed to be solicitation for the purchase of the corporation's common shares.

TSX Venture Exchange has not read or approved this release.

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