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Brownstone Provides Colombian Operations Update

Source: www.gulfoilandgas.com 5/1/2012, Location: South America

Brownstone Energy Inc is pleased to announce that it has received the following operational update for its Colombian operations.

Canaguay-1 Well, Canaguaro Block, Llanos Basin
Following a workover, cleanout and a pump replacement in late April, the Canaguay-1 well has been put back on production and continues to produce in the 1,200-1,400 BOPD range with a watercut in the range of 35%-40%. Brownstone has a 25% private participating interest in the Canaguaro Block.

Flami-1 Exploration Well, Block 27, Llanos Basin
Drilling at the Flami-1 exploration well continues and is expected to be completed by the end of May.

Mani-1 Exploration Well, Block 27, Llanos Basin
As part of the extended test following the oil discovery, the operator has observed that total fluid production has continued to increase, with the watercut also continuing to increase and now exceeding 85% of production fluids. As a result, the operator is now investigating whether: a) the cement job from the original completion has failed to hold properly causing water to seep from lower zones; or b) if the water is being produced from the target reservoir. The operator has decided to suspend production of the well until the drilling of the Flami-1 well is completed, at which time the operator will review the option of carrying out another remedial cement job.

Brownstone pays 50% of cost and has a 45.275% revenue interest in this Llanos 27 Block (including both the Flami-1 and Mani-1 exploratory wells) before payout, and a 34.25% private participating interest following payout.

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