Sea Dragon Provides Operational Update in Egypt

Sea Dragon Energy Inc. (Sea Dragon or the Company) is pleased to announce the following operational update for its recent work program in Egypt.

NW Gemsa Concession
The NW Gemsa concession is located onshore on the west side of the Gulf of Suez, some 300 km southeast of Cairo. Two main oil fields are producing light oil, the Al Amir SE field along with the Al Ola extension to the south and the Geyad field to the north.

Current production from the Al Amir SE and Geyad fields is approximately 9,500 bopd gross (950 bopd net to Sea Dragon). Cumulative production from the NW Gemsa Concession has now exceeded 8.2 million barrels of 42 degree API Crude oil. Sea Dragon has a 10% working interest in the NW Gemsa Concession with Vegas at 50%, as operator and Circle Oil PLC with 40%.

Al Amir SE-12 ST Well:
This development well, located in the south eastern area of the Al Amir SE field was spud on April 24, 2012. The objective of the well was to appraise the Kareem Shagar and Rahmi sands. The well reached a total depth of 10,200 feet and was subsequently sidetracked to the northeast as the Kareem sands were faulted out. The sidetrack was successfully drilled to a final total depth of 10,315 feet, encountering 15.5 feet of oil pay in the Shagar sand.

The well was perforated in the interval 9,669 to 9,684.5 feet and flowed oil and gas on test at an average rate of 2,595 bopd and 4.7mmscf/d respectively, on a 48/64” choke. The well has now been placed on production at an initial flow rate of 1,038 bopd. The rig was released and moved to the Ola-3 well location.

Al Ola-3 Well:
This injection well, located in the southern part of Al Amir SE field, on the Al Ola development lease, was spud on July 16, 2012. The well is situated approximately 870 meters south of the Al Ola 1x well and 1,445 meters south east of Al Ola-2 well, and is prognosed to be drilled to a total depth of 10,320 feet into Upper Rudeis.

The primary objective of the well is to provide injection support to the Kareem sands in Al Ola area of the field. The well is currently drilling below 5,700 feet and is expected to reach its total depth by mid-August.