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Pan Orient Energy Corp.: Asia Operations Update

Dec 10, 2008 - 07:00 ET




NSE-E1 exploration well (60-per-cent working interest and operator)

The NSE-E1 exploration well, located approximately 260 meters due west of the NSE-D1 drill pad is producing at a rate of approximately 448 bbls of fluid per day (173 barrels of oil and 275 barrels of water) from the main volcanic reservoir target. Both oil gravity and pressure measurements confirm the well is located in a distinctly separate pool on the downthrown side, west of a large fault relative to the NSE field. On the basis of these NSE-E1 results, NSE-E2 will be drilled approximately 360 meters southeast and 40 meters up dip of the NSE-E1 location, a position interpreted to be significantly up dip of the oil water contact that is believed to have been encountered at the bottom of the main volcanic objective encountered at NSE-E1.

NSE-E1 was an exploration well designed to test an approximately 1 square kilometer structural closure located on the down thrown side of the main NSE field central fault compartment called NSE Central B. There had been no reserves, of any category, assigned to the NSE Central B prospect in the year end 2007 NI51-101 compliant reserves report.

NSE-D2 appraisal well (60-per-cent working interest and operator)

The NSE-D2 appraisal well encountered the top of the main volcanic reservoir at a depth of depth of 754 meters true vertical depth (TVD) approximately 330 meters north of the NSE-D1 location. Approximately 34 meters of highly fractured volcanic reservoir was drilled with mud losses of approximately 1,200 barrels. The well was put on test, flowing mainly gas with some oil, indicating close proximity to an interpreted oil water contact. Rig 14 is currently logging the main volcanic objective in a side track that encountered the main volcanic reservoir approximately 30 meters structurally lower than in the original well bore and believed to be below the gas/oil contact. Severe losses were encountered indicating good fractured reservoir is present. Testing is anticipated to commence once the rig has been moved off site to NSE-E2 and test results will be reported when stabilized rates have been achieved.

L44-V appraisal well (60-per-cent working interest and operator)

The L44-V appraisal well, drilled from a surface location approximately 1.3 kilometers south west of the Bo Rang-1 gas discovery, is currently setting intermediate casing at a depth of 484 meters (true vertical depth), approximately 200 meters above the main volcanic objective. L44-V is targeting a potential down dip oil leg within a volcanic reservoir that tested 5.5MMcfg/d at the structurally higher Bo Rang-1 well drilled by an earlier operator of the L44 concession area. Drilling is anticipated to be completed by year end.


Pasundan-1 exploration well (69-per-cent working interest and operator)

The Pasundan-1 exploration well is being plugged and abandoned after recovering formation water.

Paundan-1 was a test of a high risk, high impact reef target located onshore West Java, Indonesia, drilled approximately one year ago by the former operator of the Citarum PSC and targeting a very large seismically defined reef. The well encountered approximately 500 meters of limestone section with 21 meters of cavernous reservoir in the upper portion. This upper cavernous zone, on the basis of this test, is now proven to be water bearing.

The limestone reefs in the area of Pasundan-1 represent only one of numerous potential play types on the Citarum PSC with the majority of the area dominated by large western Canada foothills style folds. An approximately 800 km 2D seismic survey is currently underway, targeting several large, surface expressed leads independent of the target tested at the Pasundan-1 well. Further exploration drilling is planned in late 2009.

Pan Orient is a Calgary, Alberta based oil and gas exploration and production company with operations currently located onshore Thailand, Indonesia and in Western Canada.

This news release contains forward-looking information. Forward-looking information is generally identifiable by the terminology used, such as "expect", "believe", "estimate", "should", "anticipate" and "potential" or other similar wording. Forward-looking information in this news release includes, but is not limited to, references to: well drilling programs and drilling plans, estimates of reserves and potentially recoverable resources, and information on future production and project start-ups. By their very nature, the forward-looking statements contained in this news release require Pan Orient and its management to make assumptions that may not materialize or that may not be accurate. The forward-looking information contained in this news release is subject to known and unknown risks and uncertainties and other factors, which could cause actual results, expectations, achievements or performance to differ materially, including without limitation: imprecision of reserve estimates and estimates of recoverable quantities of oil, changes in project schedules, operating and reservoir performance, the effects of weather and climate change, the results of exploration and development drilling and related activities, demand for oil and gas, commercial negotiations, other technical and economic factors or revisions and other factors, many of which are beyond the control of Pan Orient. Although Pan Orient believes that the expectations reflected in its forward-looking statements are reasonable, it can give no assurances that the expectations of any forward-looking statements will prove to be correct.

45,568,366 common shares issued
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Pan Orient Energy Corp. Jeff Chisholm President and CEO (403) 294-1770 or Pan Orient Energy Corp. Jason Bednar Vice President Finance and CFO (403) 294-1770 Email: