Kulczyk Oil Spuds Ukraine Olgovskoye Well

- Kulczyk Oil Spuds Ukraine Olgovskoye Well

Thursday, August 04, 2011
Kulczyk Oil Ventures Inc.

Kulczyk Oil Ventures announced that the O-12 well on the Olgovskoye License in Ukraine commenced drilling on August 3, 2011.

O-12 Exploration Well

The O-12 well is located approximately 1.4 kilometers to the northwest of the recently tested O-9 well. The O-12 well will be drilled to a depth of 2,650 meters and is designed to test gas-bearing reservoirs in the Muscovian and Bashkirian sections and to further develop the gas production capability of the Olgovskoye Field. The drilling of the O-12 well is expected to take approximately 40 days.

The well, identified after interpretation of 2D seismic data by the KOV/KUB-Gas technical team, is on trend with the main Olgovskoye producing area and is intended to extend the known boundaries of the Olgovskoye Field. A successful well will increase gas production and lead to additional drilling locations along this trend.

Olgovskoye License

The O-12 well is the fourth new well drilled in the Olgovskoye Field since the Company acquired its interest in KUB-Gas in June 2010. It is part of a larger development program on the KUB-Gas assets through 2011 and 2012 which has involved the drilling of new wells at O-8, O-9 and O-14. The Olgovskoye Field currently produces from 4 wells (O-3, O-4, O-5 and O-7) with each well producing from a separate horizon.

The first of new wells was drilled at the Olgovskoye-8 location and reached a total depth ("TD") of 2,780 meters in early January. Production testing of the O-8 well will begin in August.

The second of the new wells drilled on the Olgovskoye license, the O-9 well, finished drilling at a depth of 2,638 meters in mid-April and was cased to TD as a potential multi-zone gas well. The O-9 was production tested in June and July of this year and the well is expected to begin commercial production at a gross rate of approximately 1.5 million cubic feet per day ("MMcf/d") prior to the end of the third quarter as disclosed in the news release of KOV dated August 1, 2011.

The third of the new wells, Olgovskoye-14 ("O-14"), was drilled to a TD of 2,800 meters and cased to TD after encountering up to eight potential gas-bearing zones in the Middle and Lower Bashkirian sections of the well as disclosed in the news release of KOV dated 18 July 2011. A service rig will be moved to the O-14 location to production test the well after the production testing of the O-8 well is finished.

KUB-Gas LLC ("KUB-Gas") owns a 100% interest in the Olgovskoye license and in four other licenses in the Lugansk area of Ukraine. KOV owns an effective 70% interest in KUB-Gas.

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Kulczyk Finds Potential Gas Reservoirs in Olgovskoye Well

- Kulczyk Finds Potential Gas Reservoirs in Olgovskoye Well

Monday, July 18, 2011
Kulczyk Oil Ventures Inc.

Kulczyk Oil Ventures Inc. announced the O-14 well in the Olgovskoye Field, in north-eastern Ukraine, has been cased to total depth ("TD") after encountering eight potential gas bearing reservoirs.

O-14 Exploration Well

The O-14 exploratory well was drilled to a TD of 2,800 metres. The eight potential gas-bearing zones where encountered in the Middle and Lower Bashkirian portions of the well. The well was drilled to further increase the gas production capability of the Olgovskoye Field and was drilled into a separate fault block which had not previously produced gas. Production testing of the O-14 well is expected to commence in late August / early September.

Next Well

The drilling rig will now be moved to a new location at O-12 which lies at the north end of the Olgovskoye license area. The new well is located 500 metres northeast of the O-7 well and 7,000 metres northeast of the recently drilled O-14 location. The O-12 well is designed to test gas-bearing reservoirs in the Muscovian and Middle Bashkirian and to further develop the gas production capability of the Olgovskoye Field. The O-12 well is expected to commence drilling in late July.

Olgovskoye Field

The O-14 well is the third new well drilled on the Olgovskoye license since the Company acquired its 70% interest in KUB-Gas in June 2010 and is part of a larger development program on the KUB-Gas assets through 2011 and 2012.

Kulczyk Oil completed drilling of the Olgovskoye-8 well in early January 2011. This well is expected to be tested and completed later in the third quarter of 2011. The O-8 well was drilled to a TD of 2,780 metres and wireline logging of the open hole identified several potential hydrocarbon-bearing zones. Another well on the Olgovskoye license, the O-9 well, reached its TD of 2,638 metres in mid-April and was cased to total depth as a potential multi-zone gas well. Completion and testing of the O-9 well indicated a gas discovery in a new zone known as the R37 unit.

The Olgovskoye Field currently produces from 4 wells (O-3, O-4, O-5 and O-7) with each well producing from a separate horizon.

Through its interest in KUB-Gas, one of the largest private gas producers in the Ukraine, KOV has an effective 70% interest in the Olgovskoye Field.

Assets of Kulczyk Oil

Kulczyk Oil is an international upstream oil and gas exploration company with a diversified portfolio of projects in Brunei, Syria and Ukraine and with a risk profile ranging from exploration in Brunei and Syria to production and development in Ukraine.

In Brunei, KOV owns working interests in two production sharing agreements which gives the Company the right to explore for and produce oil and natural gas from Block L and Block M. KOV owns a 40% working interest in Block L, a 2,220 square kilometre (550,000 acre) area covering onshore and offshore areas in northern Brunei and a 36% working interest in Block M, a 3,011 square kilometre (744,000 acre) area onshore in southern Brunei.

In Ukraine, KOV owns an effective 70% interest in KUB-Gas LLC. The assets of KUB-Gas consist of 100% interests in five licenses near the City of Lugansk in the northeast part of Ukraine. Four of the licenses are gas producing.

In Syria, KOV holds a participating interest of 70% in the Syria Block 9 production sharing contract which provides the right to explore for and, upon fulfillment of certain conditions, to produce oil and gas from Block 9, a 10,032 square kilometre (2.48 million acre) area in northwest Syria. The Company has agreements to assign an aggregate of 25% in ownership interests to third parties which are subject to the approval of Syrian authorities and which, if approved, would leave the Company with a remaining effective interest of 45% in Syria Block 9.

The main shareholder of the Company, Kulczyk Investments S.A. owns almost 50% of the issued common shares. Kulczyk Investments S.A. is an international investment house founded by Polish businessman Dr. Jan Kulczyk.

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