Canadian Oil

[Tackler]

HOA Habanero Enchant-ed by start of operations in Alberta

2004-12-29 05:38 ET - News Release

Mr. Jason Gigliotti reports

HAO COMMENCES OPERATIONS ON 50% OWNED ENCHANT PROSPECT IN ALBERTA

Habanero Resources Inc. has been informed that operations on the Enchant prospect in Alberta have commenced. Habanero Resources currently has a 50-per-cent working interest in the first well on this prospect. If the first well is successful, additional wells are planned. It is anticipated that initial results for this well are expected to be realized within 14 days barring any unforeseen issues.

The operator has informed Habanero Resources that the Stuart 60 No. 8 well in Palo Pinto county, Texas, is scheduled to commence operations later this week. Habanero has three more wells to drill on this prospect. The cost for all three of these wells has already been paid and the previous five wells drilled on this prospect were all successfully drilled.

Jason Gigliotti, president of Habanero Resources, stated: "This is a tremendously exciting period for Habanero and our shareholders. We have started operations on the prospect that could have the single largest impact on our company. Having 50 per cent of this prospect, should it achieve success, could be the turning point for the company to achieve a much larger revenue stream. When you couple this with the fact that the drilling in Texas is scheduled to commence later this week, the month of January could be the most active in the history of Habanero."

Operations are expected to commence in January on the Red Water gas prospect in Alberta. The prospect consists of one initial well, with the potential to drill multiple wells if the first well is successful. The formation of primary interest on this property is the Viking sands, which is gas productive throughout the immediate area. Recently, the Viking zones have been tested and produced gas in a number of wells in the immediate area of the prospect. Drill stem tests have resulted in flows in excess of 12 million feet of gas per day.