Calvalley provides operational update on drilling and project developments



    CALVALLEY PETROLEUM INC. (TSX: CVI.A)

    CALGARY, Dec. 14 /CNW Telbec/ - Calvalley Petroleum Inc. ("Calvalley"),
an international oil and gas exploration and production company based in
Calgary, Alberta, is pleased to provide an operational update on recent
drilling and project developments, on Block 9, in the Republic of Yemen.
Calvalley has completed drilling and has commenced testing of the Malik 1
exploration well. Additionally, the exploration well, Qarn Qaymah 2, was
spudded on December 6, 2007, and the evaluation well, Hiswah 22, has completed
an extensive coring program. As well, Calvalley has completed the evaluation
of Engineering, Procurement and Construction Management ("EPCM") bids for its
export pipeline and, pending government approval, anticipates awarding the
contract prior to the end of the year.

    Drilling of Malik 1
    -------------------

    Malik 1 is located in the southern part of Wadi Hadramut, in the central
portion of Block 9. The well was drilled to 3,426 meters of total measured
depth (3,168.6 meters of total vertical depth) in order to evaluate a large
east-west trending structural closure that encompasses a thick stratigraphic
succession having numerous reservoir-seal combinations. The well was spudded
on July 27, 2007 and intersected the Qishn clastics, at a depth of
1,233 meters, which demonstrated excellent reservoir characteristics. The
reservoir zone, to 1,280 meters, displayed light brown oil staining and fair
to good oil shows, with light yellow direct fluorescence, over a fourteen
meter interval. The fluorescence suggests the presence of a medium to light
oil. Some oil staining was also present in drill cuttings from the underlying
Saar limestone.
    Drilling into the basement was conducted through the primary hole as well
as through a deviated hole, in order to evaluate the potential for fractured
basement production. Such basement drilling has proven to be successful in
other blocks in the Masila basin. Gas shows were encountered in the basement
of the primary hole, between 3,120 meters and 3,160 meters. Image logs, run
over the primary basement granite section, confirmed the presence of open
fractures and the potential for a fractured basement play but testing of three
fracture zones failed to recover hydrocarbons. The deviated hole penetrated
338 meters of granitic basement without encountering any additional
significant hydrocarbon shows or fractures and this section of the well was
subsequently abandoned.
    Log analysis of the upper zones, by an independent third party, indicates
the presence of four meters of hydrocarbon potential in the upper Qishn
clastics, and two meters of hydrocarbon potential in the Upper Saar limestone.
A service rig has been moved on to the Malik 1 location and is preparing to
commence testing of both zones.

    Drilling of Qarn Qaymah 2
    -------------------------

    Qarn Qaymah 2, an exploration well located in the northeastern part of
Wadi Hadramut, was spudded on December 6, 2007 and is being drilled as a
follow up to the original Qarn Qaymah 1 well, which was successfully tested as
a gas-condensate discovery in the basal Kohlan sandstone. The well will also
evaluate hydrocarbon potential in the fractured basement. Drilling is
progressing on schedule.

    Drilling of Hiswah 22
    ---------------------

    Hiswah 22, a vertical well, is located in the northwestern portion of the
field and has successfully completed an extensive coring program. It is
Calvalley's intention to test and analyze these core samples to improve the
quality of the reservoir parameters being input into a reservoir simulation
model of the Hiswah field. Calvalley believes such testing and analysis will
ultimately improve the reservoir exploitation strategy. Oil was also
encountered in the Qishn formation, improving the understanding of this
formation in the Hiswah area. Calvalley intends to case this well for future
completion as either a production or injection well. Calvalley intends to
drill a second vertical evaluation well, Hiswah 23, in the southeastern
portion of the field. Again, the Company intends to core the entire reservoir
section and case the well for completion as either a production or injection
well. It is expected that Hiswah 23 will be spudded prior to year end.

    Export Pipeline
    ---------------

    Calvalley continues to progress its pipeline project to transport crude
oil production from Block 9. The Company has received and evaluated tenders
for the pipeline EPCM and the successful bidder has been selected. The Company
will be making a recommendation to the Operating Committee and anticipates
governmental approval and awarding of the contract prior to the end of the
year. Calvalley is in the process of surveying the pipeline route and also
expects to complete this effort by the end of the year. Additionally,
Calvalley has received tenders for the supply of the mainline pipe.

    Calvalley is listed on the Toronto Stock Exchange, trading under the
symbol "CVI.A".

    THE TORONTO STOCK EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT
    RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

    This press release may contain forward-looking statements including,
without limitation, financial and business prospects and financial outlooks,
and such statements may be forward-looking statements which reflect
management's expectations regarding future plans and intentions, growth,
results of operations, performance and business prospects and opportunities.
Words such as "may", "will", "should", "could", "anticipate", "believe",
"expect", "intend", "plan", "potential", "continue", and similar expressions
have been used to identify these forward-looking statements. These statements
reflect management's current beliefs and are based on information currently
available to management. Forward-looking statements involve significant risk
and uncertainties. A number of factors could cause actual results to differ
materially from the results discussed in the forward-looking statements
including, but not limited to, changes in general economic and market
conditions and other risk factors. Although the forward-looking statements
contained herein are based upon what management believes to be reasonable
assumptions, management cannot assure that actual results will be consistent
with these forward-looking statements. Investors should not place undue
reliance on forward-looking statements. These forward-looking statements are
made as of the date hereof.
    Forward-looking statements and other information contained herein
concerning the oil and gas industry and Calvalley's general expectations
concerning this industry are based on estimates prepared by management using
data from publicly available industry sources as well as from reserve reports,
market research and industry analysis and on assumptions based on data and
knowledge of this industry which Calvalley believes to be reasonable. However,
this data is inherently imprecise, although generally indicative of relative
market positions, market shares and performance characteristics. While
Calvalley is not aware of any misstatements regarding any industry data
presented herein, the industry involves risks and uncertainties and is subject
to change based on various factors.
    %SEDAR: 00001745E




For further information:

For further information: Renmark Financial Communications: Tina Cameron,
tcameron@renmarkfinancial.com; Neil Murray-Lyon,
nmurraylyon@renmarkfinancial.com, (514) 939-3989, Fax: (514) 939-3717,
www.renmarkfinancial.com; Source: Edmund M. Shimoon, CEO, Calvalley Petroleum
Inc., (403) 297-0491, Fax: (403) 297-0499

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