True North Energy Corp.
OTC Bulletin Board : TNEN

True North Energy Corp.

April 02, 2007 09:20 ET

True North Energy Announces Operations Update

HOUSTON, TEXAS--(CCNMatthews - April 2, 2007) - True North Energy Corporation (OTCBB:TNEN), an independent oil and gas exploration company, is pleased to provide an Operations Update on its recent activities.

BP America Production Company ("BP") test well, A. Major Heirs No. 1 located in Pointe Coupee Parish, Louisiana targeting Tuscaloosa Sands, reached its objective zone at a measured depth of approximately 18,550 feet on March 24, 2007. The Test Well was logged and evaluated from March 24 to 26, 2007. The Test Well was drilled pursuant to a Development Agreement made effective as of January 1, 2007 between the Company and BP. We had the right to earn an 8.75% working interest in the well.

Although the well penetrated over 300 feet of Tuscaloosa sands with good porosity and permeability, the well was structurally low and was deemed not to contain commercial hydrocarbon accumulations. BP has elected to plug and abandon the open hole portion of the well. However, in the process of evaluation, it was determined that the well crossed a previously unknown fault that isolated the existing wellbore from the target fault block which was contemplated in the Agreement. BP and the Company signed a letter agreement dated March 28, 2007 to sidetrack the test well from 17,380 feet measured depth and attempt to drill the well to a new bottom hole location approximately 200 to 300 feet west of the current bottom hole location and a depth sufficient to test the stratigraphic equivalent of the Tuscaloosa B-1 through C-1 sands as seen at between 18,070 and 18,485 feet in the off-set Amerex - Major Heirs No. 1 well, or to a measured depth of 18,600 feet, whichever is shallower.

The estimated cost of the sidetrack (Tuscaloosa B-1 through C-1 sands) is approximately $3.5 million. If BP elects to set the liner to drill to the deeper Tuscaloosa C-2 sand, the additional cost is estimated at $1,5 million. The current estimated drilling cost, including the estimated cost to plug the open hole portion of the original part of the well, is $11.6 million. The original cost estimate for the test well was $14.9 million. BP has agreed to apply the approximately $3.2 million surplus to the sidetracking operation. BP has the drilling rig on location and is presently moving forward with the sidetracking operation. As of today, the whipstock has been set, a window has been milled in the casing, and the drilling operations have resumed.

"We are disappointed with initial results on the well, but very encouraged with the progress of the sidetrack operations. There is always a drilling risk associated with this type of the operation, but we anticipate being able to reach the new bottom hole location and test sands structurally higher from the sands that flowed in excess of 5 mmscfd from the offset well," said John Folnovic, True North Energy President and CEO.

"To date, our strategy has been concentrated towards participation in third party developed prospects. We are now focusing on acquiring controlling acreage positions in active North American basins to provide us with new core operating areas, in addition to our Alaska interests. We continue to receive strong support from our major shareholders through this early development stage," said Folnovic.

Further Information

Shareholders and interested parties are encouraged to visit True North Energy's website: and download True North Energy Corporation's Information Package. Please feel free to call shareholder relations toll-free on 1-888-567-0888 to receive a corporate information package. Alternatively, sign up at the website to receive news on the company as it becomes available.

About True North Energy Corporation

True North Energy Corporation is a publicly traded, independent oil and gas exploration company, with headquarters in Houston, Texas. True North Energy Corporation is focused on development of company's core asset in Alaska. The company is strategically located in the Cook Inlet and Beaufort Sea areas of Alaska and has commenced technical evaluation of its 34,850 acres of petroleum land holdings. True North Energy Corporation trades on the NASD OTC BB under the ticker symbol: TNEN.

John Folnovic, President and CEO

Forward-Looking Statements

Statements in this news release that are not historical facts are forward-looking statements that are subject to risks and uncertainties. Words such as "expects", "intends", "plans", "may", "could", "should", "anticipates", "likely", "believes" and words of similar import also identify forward-looking statements. Forward-looking statements are based on current facts and analyses and other information that are based on forecasts of future results, estimates of amounts not yet determined and assumptions of management, including, but not limited to, the Company's belief that True North Energy Corporation can identify and successfully negotiate leases for oil and gas properties in Alaska, and that the Company can participate in the exploration of those properties. Actual results may differ materially from those currently anticipated due to a number of factors beyond the reasonable control of the Company. Additional information on risks and other factors that may affect the business and financial results of the Company can be found in filings of the Company with the U.S. Securities and Exchange Commission.

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