ZAAB ENERGY AG
ZAAB Energy AG advances drilling works and identifies additional gas resources
ZAAB ENERGY AG / Miscellaneous Release of a Corporate News, transmitted by DGAP - a company of EquityStory AG. The issuer / publisher is solely responsible for the content of this announcement. ---------------------------------------------------------------------- Munich, 6 August 2007. ZAAB Energy AG is a Munich based independent oil and gas exploration and pre-production company which expects to start up its oil production in the near future. ZAAB Energy’s Russian subsidiary ZAAB Invest holds a license portfolio to five areas located in the Russian Federation between Black and Caspian Sea with significant oil and gas resources. The Russian city of Sochi, which will be the place of the 2014 Olympic Winter Games, is located in the Krasnodar region as are several of the ZAAB Invest oil and gas fields. Drilling in the South-Yermolinskiy license area By 3 August 2007 approximately 2,200 meters of drilling had been completed at ZAAB Invest’s South-Yermolinskiy license area which is located in the Republic of Kalmykia of the Russian Federation. The casing was cemented down to a depth of approximately 1,650 meters and preparations of the drilling equipment for further drilling down to the target hydrocarbon horizons were finalised successfully. ZAAB Energy now expects that drilling to the target horizons with a depth of approximately 2,900 meters could be completed as early as September this year. The drilling confirmed the existence of gas in approximately 875 to 900 meters which had not been anticipated before. Mr. Zamir Abdullaev, the CEO of ZAAB Invest, stated: 'The drilling is implemented by a drilling company with extensive experience. There are currently 18 people working on the South-Yermolinskiy field and progress has been in line with expectations.' Geological work in the Maryinskiy license area ZAAB Invest further continued its geological work on the Maryinskiy license area which is located in the Stavropol region. The license area held by ZAAB Invest includes a well which already produced crude oil. The drilled well had initial inflows of approximately 200 tons (approximately 1,500 barrels) per day which is a very significant rate by international standards. The existing geologic data from this well was presented to an independent geological institute for so-called re-interpretation. The geological institute confirmed in July 2007 not only the oil and gas bearing horizons already identified by ZAAB Invest but identified also a new one. In particular, the institute confirmed that the newly identified oil and gas bearing horizon can be expected to have a total thickness of up to eight meters which would be considerable. ZAAB Invest is currently working intensely on reactivating the existing well. New drilling results from this area are expected in early 2008. License compliance License compliance is a key factor for operating successfully in the Russian Federation. From 26 June until 6 July 2007 representatives from the Government of the Republic of Kalmykia’s environmental department (in Russian called 'Rosprirodnadzor') inspected ZAAB Invest’s activities at the South-Yermolinskiy license area. They confirmed that ZAAB Invest operates fully in compliance with the license terms. Such inspections are usually made every two to three years. According to 'Rosprirodnadzor' only two other oil and gas companies in the Republic of Kalmykia achieved a compliance level similar to ZAAB Invest, namely Gazprom and Rosneft. Already in March 2007, 'Rosprirodnadzor' inspected ZAAB Invest’s activity at the Vyselkovsko-Kubanskiy license area in the Krasnodar region and confirmed ZAAB Invest’s observance of the license terms. Participation of ZAAB Invest in the Moscow International Oil and Gas Exhibition ZAAB Invest participated in the Moscow International Oil and Gas Exhibition (MIOGE 2007) which took place from 26 June until 29 June 2007. MIOGE is Russia’s largest oil and gas exhibition and is also one of the top ten oil and gas exhibitions in the world. This year approximately 800 companies from 30 countries were represented at the exhibition, 45% of which were international and 55% Russian. More than 25,000 visitors attended the event. ZAAB Invest explained its current production programme, its work on the exploration well in the South-Yermolinskiy license area and the operation of a new mobile drilling rig that ZAAB Invest intends to use for drilling works from the beginning of 2008. Forward looking statements This news release is based on partly forward looking statements i.a. on planned drillings and expansion drillings, as well as associated costs and estimates of oil and gas production, cash flows and other factors. All statements such as planned, estimated, expected, potential etc. are of a forward looking nature. Although ZAAB Energy AG is of the opinion that the forward looking statements are plausible, they comprise risks and uncertainties in a way that the occurrence of the assumed results may not be warranted. Important factors that may lead to deviations between the actual results and the forward looking statements are e.g. issues of a technical or mechanical nature or geological issues, which may lead to the result that a commercial recovery of the reserves or resources is not possible. In addition, prices may have an important impact on profitability. No offer to sell shares This document represents neither an offer to sell shares of ZAAB Energy AG ('the Company') nor an invitation to make an offer to purchase shares of the Company. This document and the information contained therein may not be brought into or transmitted to the United States of America or distributed or transmitted to American persons (including legal entities as defined in Regulation S of the United States Securities Act of 1933, as amended - the 'Securities Act') or to publications with a general circulation in the United States of America. Each violation of such limitations may constitute a violation of applicable securities laws. The shares of the Company have not been, and will not be, registered under the Securities Act, or with any securities regulatory authority of any state or other jurisdiction of the United States, and may not be offered or sold within the United States or to, or for the account or benefit of any US person (as defined in Regulation S under the Securities Act) except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There shall be no sale of shares in the Company in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to qualification under securities laws of such state or jurisdiction. Jan-Hendrik Röver, Member of the Board, tel.: +49 89 242 246 910 DGAP 06.08.2007 ----------------------------------------------------------------------
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