Toronto, Ontario, Canada - Candax Energy Inc. ("Candax") [TSX: CAX] is pleased to announce that the Chaal-1 exploration well, located on the Chaal Permit in Tunisia, was spudded on February 5, 2006. Surface casing is due to be set at 480 metres, and the well is currently drilling ahead at 205 metres. The Chaal-1 well is expected to take approximately 50 days to drill to a total depth of approximately 4,500 metres and log. An additional 30 days is expected for completion and testing. The preliminary testing program, approved by partners, is subject to log interpretation and calls for the testing of at least three zones in the primary target Lower Nara formation.
Candax, as previously announced, has mapped a large prospect in the Chaal Permit, which could extend over an area of 300 square kilometres and has multi-Tcf potential area. Two wells that were drilled on the structure over 40 years ago, encountered a hydrocarbon column of approximately 150 metres in the Lower Nara, Jurassic formation. Several zones were successfully tested in the column at rates of up to 3 MMcf/d of gas and condensate rates ranging from 25-80 barrels per MMcf.
Simultaneously, Candax announces an update on the impending mobilization of the El Bibane redevelopment program offshore Tunisia. The previously announced contracted mobilization date of January 23, 2006 has not been met due to engineering and certification delays related to the fabrication and construction of the jack-up barge system. Candax has placed members of its team to work alongside the contractor to accelerate this process, and looks forward to communicating a revised schedule for the El Bibane drilling program by mid-February.
Michael Wood, President & CEO, commented: "The Candax team is delighted to announce the spudding of the high impact Chaal-1 exploration well. This multi-Tcf prospect is the kind of world class exploration play that we want to expose our investors to."
Candax Energy is an international energy company with its head office in Toronto, Ontario, Canada and management offices in London, Dubai and Tunis. The Company holds a number of concessions in Tunisia through its subsidiary companies and is involved in the exploration and production of oil, gas and power generation in the country. Candax was formed through the combination of a highly experienced executive management team with successful Canadian founders and financiers, to develop an international upstream oil and gas project portfolio. Candax is initially focusing its growth activities on production and development projects in the Middle East and North Africa, where the group has strong relationships and extensive management experience.
For further information, please contact:
John Clarke, Executive Vice President, Corporate
T: (416)361-2824
F: (416)364-5400
E: jclarke@candax.com
Fred Cowans or Tracy Weslosky, Managing Partners
Pro-Edge Consultants Inc.
T: 866.544.9622 or 416.581.0177
E: info@pro-edge.com
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This press release includes "forward looking statements", within the meaning of applicable securities legislation, which are based on the opinions and estimates of Management and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "budget", "plan", "continue", "estimate", "expect", "forecast", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe" and similar words suggesting future outcomes or statements regarding an outlook. Such risks and uncertainties include, but are not limited to, risks associated with the oil and gas industry (including operational risks in exploration development and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections in relation to production, costs and expenses; the uncertainty surrounding the ability of Candax Energy Inc. to obtain all permits, consents or authorizations required for its operations and activities; and health safety and environmental risks), the risk of commodity price and foreign exchange rate fluctuations, the ability of Candax Energy Inc. to fund the capital and operating expenses necessary to achieve the business objectives of Candax Energy Inc., the uncertainty associated with commercial negotiations and negotiating with foreign governments and risks associated with international business activities, as well as those risks described in public disclosure documents filed by Candax Energy Inc. Due to the risks, uncertainties and assumptions inherent in forward-looking statements, prospective investors in securities of Candax Energy Inc. should not place undue reliance on these forward-looking statements. Statements in relation to "reserves" are deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves described can be profitably produced in the future.
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