Petroamerica Provides Operations Update in Colombia

Petroamerica Oil Corp, a junior oil and gas company operating in Colombia is pleased to provide an update of ongoing drilling and production operations for certain properties in Colombia, including the discovery of light oil at La Casona-1. The Company is actively involved in the drilling and testing of the La Casona-1 exploration well, the Las Maracas-5 appraisal well and the Balay-4 development well.

The La Casona-1 exploration well, situated on the El Eden Block where Petroamerica holds a 40% working interest, was spud on September 4, 2012 and has reached a total depth of 16,450 feet measured depth (“MD”) in the Une Formation. The well encountered hydrocarbon shows while drilling through the C7, Mirador, Gacheta and Une reservoirs. A petrophysical evaluation of LWD (logging-while-drilling) and cased-hole logs indicates a total of more than 80 feet (true vertical depth (“TVD”))of potential net hydrocarbon pay in the well. The two primary reservoir objectives, the Mirador and Une, have interpreted gross hydrocarbon-bearing columns of up to 40 feet (TVD) and 77 feet (TVD), and potential net pay thicknesses of 30.5 feet (TVD) and 50 feet (TVD), respectively. The well was cased-off and the Une reservoir flow tested using the drilling rig for more than 33 hours with intervening shut-ins. During the last and most representative flow period of 8 hours and 30 minutes, the well produced under natural flow conditions light oil (36o API) at an average rate of approximately 1,200 barrels of oil per day (“bopd”) with 4.0 MMCFD of gas and a maximum oil rate of 1,288 bopd. The well head flowing pressure was 3,010 psi and the watercut at the end of the test was less than 0.8%. The well flow rate was restricted through a 20/64 inch choke due to gas flaring limitations. The drilling rig will be released and a workover rig will further assess the well’s ultimate flow potential and test other reservoirs with identified hydrocarbon pay. Of Petroamerica’s 40% working interest in the El Eden Block, 15% is still pending ANH (Colombian National Hydrocarbon Agency) approval.

The Las Maracas-5 well, located on the Los Ocarros Block where Petroamerica holds a 50% working interest, was spud on September 30, 2012 and has reached a total depth of 12,970 feet MD in the Une Formation. Oil saturated cores were recovered from the Mirador and Gacheta reservoirs and these cores are currently being analyzed in the laboratory. The well has been logged and cased with the wire-line log interpretation indicating more than 48 feet of net oil pay (TVD) in the Mirador and Gacheta sands, including a new lower Gacheta sand with 15 feet of net oil pay (TVD). The well is undergoing flow testing and thus far, the new lower Gacheta sand has yielded over a 20 hour flow period, under natural flow through a one inch choke, an average rate of 635 bopd and a maximum rate of 754 bopd of 32o API oil. The watercut at the end of the test was 0.3%. The middle Gacheta sand, which produces at the Las Maracas-3 and Las Maracas-4 wells, will be the next sand to be flow tested following which the Tuscany 109 rig will drill the Las Maracas-6 well.

The Balay-4 development well, situated in the southern part of the Balay Field where Petroamerica holds a 15% working interest, was spud on October 12, 2012. As of November 13, 2012, the well was drilling at a depth of 8,567 feet MD in the Leon Formation.

For the month of October, the Company averaged a total working interest production of 2,718 bopd (2,468 bopd net after royalties).