pukeko progress report

1st target not home ..... 2 to go :)

PUKEKO-1 PROGRESS REPORT

At 6:00am NZ time on 20 May, Pukeko-1 was at a depth of 3449 metres and
drilling ahead in 8 ?" hole.

Over the interval 3285 to 3320 metres minor oil shows were observed in the
upper part of the Kapuni C Sands, the first of three objectives in the well.
The indications to date are that this interval is unlikely to be commercially
significant. However, electric logs, which will be run when the well reaches
total depth, are needed to confirm this. It is expected that the D Sand and
F Sand targets will be intersected over the next few days.

New Zealand Oil & Gas Limited holds a 12.5% interest in PEP38460 through
subsidiary Stewart Petroleum Company Limited.

Other participants in the venture are New Zealand Overseas Petroleum Limited
(operator) 45%; WM Petroleum Limited (a wholly owned subsidiary of Pan
Pacific Petroleum N.L.)10%; AWE New Zealand Pty Ltd 20%; and Mitsui E&P New
Zealand Limited 12.5%.