Zapata Energy Corporation

Zapata Energy Corporation

January 30, 2008 09:00 ET

Zapata Announces 2008 Budget

CALGARY, ALBERTA--(Marketwire - Jan. 30, 2008) - Zapata Energy Corporation (TSX VENTURE:ZCO) is pleased to announce that its board of directors has approved a $20 million capital budget for 2008. This budget includes up to 16 operated wells, additional waterflood development and active seismic and land programs. The budget will be financed out of cash flow.

Zapata has planned an active drilling program for the first quarter of 2008 with six wells scheduled. The program includes two deep wells and one shallow well, all of which have the potential to be significant producers. The remaining wells are targeting seismically defined projects in core areas.

In the fourth quarter, Zapata benefited from wells being brought back on production that were shut in for much of the third quarter and the first part of the fourth quarter. Accordingly, Zapata's fourth quarter production sales average is expected to be in excess of 2,900 barrels of oil equivalent per day (boe/d), up from the third quarter which averaged 2,798 boe/d.

In accordance with its compensation plan for directors, Zapata has issued 20,000 stock options to each of its directors. An additional 285,000 stock options were granted to employees and senior consultants of the Corporation inclusive of 50,000 issued to the Chief Financial Officer. All of the stock options have an exercise price of $2.85 per share, which was the closing price on the date of issue. The options vest as to one-third immediately and one-third on each of the first and second anniversaries of the date of grant and will expire on January 25, 2013. Following this grant, the Corporation will have 1,487,000 stock options and 18,879,378 diluted shares issued and outstanding.

Zapata is a junior oil and gas production company operating in western Canada and trades on the TSX Venture Exchange under the symbol "ZCO".

This press release may include forward-looking statements which are statements other than of historical fact, such as information regarding drilling potential and production forecasts. Factors that could cause actual results to differ materially from our expectations include exploration and development risks, commodity prices and operating hazards. A barrel of oil equivalent (boe), derived by converting gas to oil in the ratio of six thousand cubic feet of gas to one barrel of oil, may be misleading, particularly if used in isolation. A boe conversion is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

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

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