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March 2007, FIRST QUARTER 2007 – EXPLORATION AND PRODUCTION NEWS

PAUL’s DRAW PROSPECT, CAMPBELL COUNTY, WYOMING

Since March 2006, Trend has drilled a new well in Section 18 and completed several workovers.

Initially, the Trend Federal #28-5 well was converted to a disposal water well in August and September 2006. With this new disposal well, Trend can handle a larger amount of produced water. Thus, a submersible pump was installed in the Trend Federal #28-4 well in December 2006 to obtain an increase in oil production. The Trend Federal #28-4 well increased its production by at least one hundred fifty percent (150%).
In addition, the progressive cavity pump of the Trend Federal #28-3A well had to be changed.

Secondly, Trend focused its exploration efforts on a new reprocessing of the 3D seismic which lead to identify several new drilling locations.
One of these new seismically defined locations, the Trend Federal #13-18 well, was drilled in Section 18 in February 2007. It encountered the Minnelusa C-2 sand structurally high with a 34’ oil column that appeared potentially productive. The progressive cavity pump completion was successful and the well is currently making approximately 279 barrels oil per day and no water.
The new seismically defined structure appears similar to the structure in Section 28 offering a potential of two offset locations. Trend anticipates drilling these two new offset locations back to back beginning in September 2007.

PYRAMID HILLS PROSPECT, KINGS COUNTY, CALIFORNIA

The deviated Compass Global Resources SB #1 well, the initial development well of this prospect, was drilled in May 2006. It reached a vertical total depth of 1,150 feet (350.50 m) and a total measured depth of 1,420 feet (432,80 m). The Miocene Tremblor sands and the Kreyenhagen K-1 and K-2 sands were encountered in accordance with our expectation with numerous oil shows.
The second development well, the deviated Compass Global Resources SB #2 well, was drilled back-to-back in May 2006. It reached a total vertical depth of 1,144.70 feet (348.90 m) and a total measured depth of 1,470 feet (448.10 m). It encountered numerous oil shows while drilling through the Tremblor and the Kreyenhagen sands.

These two wells were completed at the same time at the end of May and beginning of June. Through March 2007 these wells have produced 5,135 barrels of oil.

There is a possibility that a third party investor will purchase 50% working interest in these two wells to conduct a steam assisted gravity drainage project (SAGD).

VANGUARD PROSPECT, TERREBONNE PARISH, LOUISIANA

In January 2007, Neumin Production Company (Operator) drilled the deviated ConocoPhillips et al. #1 well whose objective was to test the 84, 86, 87 and 88 Bigenerina Humblei sands. The well reached a total vertical depth of 12,100 feet (3,688.10 m) and a total measured depth of 12,535 feet (3,820.70 m). Unfortunately the sands were water saturated.
This well was plugged and abandoned. This prospect was unsuccessful.

BALL RANCH PROSPECT, KENEDY COUNTY, TEXAS

Since the first quarter of 2006, Texican Oil drilled a new well on the Western part of the Ranch, a second well on the Eastern part of the Ranch, and another well on the Texican Oil/Exxon acreage. Texican Oil also finalized the drilling/completion operations for the Clark & Sain #16 well and Ball Ranch #7 well.

Western Part

The Clark & Sain #16 well was completed in March 2006 and its cumulative production through the end of March 2007 is approximately a quarter of a billion cubic feet of gas. Presently the daily gas production is approximately 500 thousand cubic feet of gas.

The Clark & Sain #18 well, drilled in October/November 2006, reached a total depth of 14,920 feet (4,547.60 m) and encountered numerous gas shows while drilling. The Vicksburg sand levels being the Vx1, Vx3 & Vx4 were fractured, completed, and commingled. Three months later, a 2”3/8 production tubing was installed. The present daily gas production is approximately 700 thousand cubic feet of gas.

The Clark-Sain #10 well, after 5-days build-up, was perforated and completed in the behind pipe Vx1 reservoir. The Vx1 was fractured and commingled with the previous production from the lower Vicksburg intervals. The production increased considerably.

Eastern Part

The deviated Ball Ranch #8 well was drilled from May to July 2006 and reached a total measured depth of 16,650 feet (5,074.92 m). Numerous gas shows were encountered while drilling but only the Vx3 level of the Vicksburg sands was confirmed to be productive by the electrical logs. This level was fractured at the beginning of August 2006 and put on line. The cumulative production is slightly over 260 million cubic feet of gas. In December 2006 a production string was installed in the well. Presently the daily gas production is approximately 700 thousand cubic feet of gas.

The Ball Ranch #4 well was plugged and abandoned on the 28th of December, 2006.

EXXONMOBIL JOINT VENTURE (NORTH JULIAN PROSPECT/BALL RANCH AREA)

The Ball Ranch #7 well was drilled from March to May 2006 and reached a total depth of 15,500 feet (4,724.40 m). The productive layers encountered are the Vx1 and the Vx8 of the Vicksburg sands. The majority of the production comes from the Vx1; the lower level is much less permeable. In December 2006 a 2”3/8 production tubing was installed in the well. Until April 2007, this well has cumulative production of 1.14 billion cubic feet of gas.

The Clark & Sain #17 well, drilled in August and September 2006, reached a total depth of 14,600 feet (4,450 m). Numerous gas shows were observed while drilling. Numerous sand levels being the Vx1, Vx3, Vx4 and Vx5 levels of the Vicksburg sands were commingled after being fractured. The lengthy completion was finalized in November 2006. The initial production was approximately 11 million cubic feet of gas per day. The well has cumulative gas production approximating 885 million cubic feet of gas in five months. Presently the production rate is approximately 3 million cubic feet of gas per day.

In July 2007, workovers were achieved in the King Ranch State #136-1 well. The upper Vicksburg sand level was perforated, fractured and commingled with the existing production. Presently the well is making approximately 1.4 million cubic feet of gas per day.

BLOCKER PROSPECT, HARRISON COUNTY, TEXAS

The Blocker prospect is located in Harrison County, Texas and covers approximately 682.45 acres. The Operator is Comstock Oil & Gas, LP. Texican Oil, having interests in this prospect since 1989, was offered to participate in the drilling of new wells.
Beginning in February 2006, Comstock drilled the B.S. Harrison #5 well whose objective was the Taylor sands of the lower Cotton Valley (Jurassic). This well reached a total depth of 10,308 feet (3,141.90 m). Numerous sands levels were perforated and fractured. The cumulative commingled production through the end of January 2007 is approximately 206 million cubic feet of gas and 1,880 barrels of oil.
In March 2006, Comstock drilled back-to-back the B.S. Harrison #3 well. It reached a total depth of 10,314 feet (3,143.70 m). In April, this well was completed and a two-stage acid frac was performed on the Taylor sands of the Cotton Valley. The cumulative production over the first nine months was approximately 137 million cubic feet of gas and 1,100 barrels of oil.
In May and June 2006, the B.S. Harrison #4 well was drilled to a total depth of 10,315 feet (3,144 m). The Cotton Valley sands encountered were completed and fractured in June 2006. In seven months, this well has produced approximately 194 million cubic feet of gas and 1,730 barrels of oil.

CHOKE CANYON PROSPECT, LIVE OAK COUNTY, TEXAS

The sale of the Choke Canyon prospect was not achieved and the sale was terminated. Texican Oil has been informed that a new Operator was appointed as of August 1st, 2007. The new Operator is Enduring Resources of Denver, Colorado.

BOOKER 3D PROSPECT, LIPSCOMB/OCHILTREE COUNTIES, TEXAS

The first well in which Texican Oil participated in this new prospect was the horizontal well Bailey 939#2 well which was drilled in April/May 2006 and completed in June 2006. This well whose objective is the Cleveland sands, upper formation of the Pennsylvanian, reached a total vertical depth of 7,293 feet (2,223 m) and a total measured depth of 9,949 feet (3,032.5 m). Gas shows were encountered over a 600 feet interval of sands. A dry nitrogen frac treatment was performed on these sands. The first 7-months cumulative production was 2,040 barrels of oil and 370 million cubic feet of gas. Presently, the daily production is approximately 1.7 million cubic feet of gas and few barrels of oil.
The Molly 1114#4 well, having the Morrow sands as the primary objective, was drilled from June to September 2006 on an amplitude anomaly observed in seismic. The well reached a total vertical depth of 9,303 feet (2,835.50 m). The analysis of the electrical logs demonstrated that these channels sands had not been encountered. A sidetrack was initiated then abandoned due to severe mechanical problems. Thus this well was plugged and abandoned.
The horizontal Angel 909#2 well, drilled in September/October 2006, reached a total vertical depth of 7,302 feet (2,225.5 m) and a total measured depth of 10,108 feet (3,081 m). Numerous gas shows were observed while drilling. The horizontal lengthy completion was achieved open hole. After a nitrogen frac treatment the production stabilized at a rate of 2 million cubic feet gas per day.

MARACAS FIELD, CESAR BASIN, COLOMBIA

Since the first quarter of 2006, Texican Oil has been studying the best alternatives for the exploitation of the Compae gas field. The project of building 23 miles (37 km) of gas pipeline with a tie-in to the existing Ballena-Barrancabermeja pipeline was selected.
Treating facilities will be built on Compae gas field as well as a compression station.
The building of the gas pipeline should begin before the end of this year. The gas should be commercialised during the first half of 2008.

CORDILLERA DE FLOR COLORADA, Caldas, Cundinamarca & Tolima departments, Colombia

This prospect, contracted by Texican Oil in 2006 with the National Hydrocarbons Agency (ANH) is a technical evaluation one-year project over a large block which is located on the boundaries of the following contiguous departments: Caldas, Cundinamarca & Tolima.
The block covers 122,794.3227 hectares. Texican purchased to ANH all the existing technical documents including many of the 2D seismic lines.
The purpose is to identify the petroleum potential of the area by reprocessing the 2D seismic and analysing new complementary technical studies such as surface geology, gravimetry, geochemistry, aerial photography, and magnetics.
The investment agreed on with the ANH for this technical evaluation analysis is a minimum of US$ 390,000.00.
At the end of the contract year, Texican Oil has the option to pursue its investment by applying for an Exploration & Production contract with ANH, in a part of the area. This option has been already chosen.