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Surprised GUSH has not moved over a buck on yesterday's news.

GUERNSEY, Channel Islands--(BUSINESS WIRE)--Feb. 25, 2004--CanArgo Energy Corporation ("CanArgo") (OTCBB:GUSH - News; OSE:CNR) is pleased to announce that gross total proved oil reserves at its Ninotsminda Field in Georgia at January 1, 2004 have increased by 63% to 6.76 million barrels.
The reserves appraisal report effective January 1, 2004 was prepared by Oilfield Production Consultants (OPC), independent petroleum consultants, in accordance with SEC classifications and guidelines. Gross total proven oil reserves for the Ninotsminda Field increased from 4.15 million barrels (mmbbls) at the end of December 2002 to 6.762 mmbbls at January 1, 2004. Over the same period, natural gas reserves, on an energy equivalent basis, decreased from 1.34 million barrels of oil equivalent (mmboe) to 0.51 mmboe.

The significant increase in recoverable oil reserves results primarily from the completion of a dynamic reservoir model during the year and the implementation of a successful development programme based on horizontal drilling. However, recovery of these reserves is dependent on application of optimal production levels for the Ninotsminda wells and further application of horizontal drilling techniques. Independent petroleum engineering specialists recommend that the optimal long-term production rate for these horizontal wells be of the order of 500 bopd. In order to maximise productivity and recoverability from the field, wells are being choked back to the approximate recommended levels while it is planned that future horizontal wells should be drilled under-balanced (i.e. producing whilst drilling) using coiled tubing once this is available in the country.

CanArgo is an independent oil and gas exploration and production company with its oil and gas operations currently located in the Republic of Georgia, Ukraine and the Caspian Sea. Further information on the Company is available at www.canargo.com and at http://www.sec.gov.

The matters discussed in this press release include forward looking statements, which are subject to various risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated in such forward looking statements. Such risks, uncertainties and other factors include the uncertainties inherent in oil and gas development and production activities, the effect of actions by third parties including government officials, fluctuations in world oil prices and other risks detailed in the Company's reports on Forms 10-K and 10-Q filed with the Securities and Exchange Commission. The forward-looking statements are intended to help shareholders and others assess the Company's business prospects and should be considered together with all information available. They are made in reliance upon the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The company cannot give assurance that the results will be attained.



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Contact:
CanArgo Energy Corporation
Julian Hammond, [phone]
Mobile: [phone]
[phone] (FAX)
[e-mail]
www.canargo.com