Matra Petroleum

Great RNS a week ago.

Here's to the drilling ....Which is only a matter of few weeks away from now.


Together with the two-year extension to the concession granted earlier this
year, this recent work has allowed us to develop a more aggressive exploration
programme for 2007. Subject to exact rig availability, we expect to have started
drilling again and to have acquired further seismic data by the end of the first
quarter of 2007 which will allow further drilling later in 2007.

Details

The Horvatkut-1 well, planned for early 2007, will appraise an existing gas
discovery that tested gas from two horizons in the Somgysamson-3 well in 1983.

Three potential reservoirs are targeted by this well. The targeted Main Sand
tested gas at a rate of 1.27mmscfd in the Somgysamson-3 well (drilled by a
previous operator of the concession) but the reservoir was concluded, by the
previous operator, to be badly damaged and therefore potentially capable of
higher rates. Additionally the improved seismic imaging shows that this section
thickens in the direction of the proposed well location. Two tests in the
Volcanics reservoir of Som-3 each tested gas at 0.27mmscfd and again these
intervals were concluded to be damaged. The Upper Sands appear on electric logs
of previous wells as multiple thin stacked sands that may be gas bearing but
were not tested. The target horizons are predicted below 1500m and the well will be drilled to a total depth of approximately 1800m.

The application of the latest seismic imaging to define the potentially best
reservoir location combined with modern drilling techniques to minimise
formation damage and modern logging should combine to reduce the risks
associated with encountering a commercial gas reservoir.

Marcali-1, Matra's second planned well, is located within a sand channel clearly identified by recent 3-D imaging and is within a mapped structure based on the remapped 3-D data. The Amplitude Variation with Offset (AVO) analysis of the 3D shows a Direct Hydrocarbon Indicator (DHI) over this prospect. This technique has proved successful in many parts of the world. Whilst the presence of gas may only be demonstrated by drilling, this technique provides an example of how modern seismic techniques may reduce exploration risks and may have significant implications for the rest of the block. The target horizon is predicted at approximately 1200m and the well will be drilled to a total depth of approximately 1350m.