chairman address / read

interest in this prospect and we believe that our shareholding in Statesman could become a
very valuable asset to Nuenco as we continue to build our inventory of assets in California.
Rights and Entitlements Issue:
We are heartened by the response to the rights and entitlements issue. These funds will
mean the Company is well capitalized going forward with the work program outlined above.
CONCLUDING REMARKS:
This is an exciting time for Nuenco shareholders. Nuenco is starting to produce positive
results including it’s first commercial well from its valuable California acreage in partnership
with Orchard at a time of record oil and gas prices. The investment in Statesman is also
proving successful and with the company cashed up and a drill rig on site, forward
momentum at the shallow gas and deeper oil prospects is likely to be brisk, and will result in
Nuenco being transformed from a pure explorer to a producer in quick time.
Yours faithfully
Anthony Kain
Managing Director
For further information please contact:
• The company on (+61 8) 9388 8431
Compliance Statement
The geological information included in this announcement is the technical assessment of the
available information by Mr Jack West, a qualified geologist employed as a technical
consultant to Nuenco. Jack has practiced as a geologist in the petroleum industry in California
for 44 years.

Jack Hamar 2-1 was drilled directionally west and up structure off the 1-1 pad and our
analysis of the well logs indicated the presence of several hundred net feet of gas sand in
this well – based on the strongest indicators we saw in our five gas wells. As indicated in the
birds eye view, the well is located to the northwest of the section 13 pad and if it performs it
will represent a major extension of the commercial gas discovery made at Jack Hamar 3-13
some 1 ½ miles to the south east (highlighting the potential for a multi well gas field at South
East Lost Hills).

Jack Hamar 2-1 was drilled directionally west and up structure off the 1-1 pad and our
analysis of the well logs indicated the presence of several hundred net feet of gas sand in
this well – based on the strongest indicators we saw in our five gas wells. As indicated in the
birds eye view, the well is located to the northwest of the section 13 pad and if it performs it
will represent a major extension of the commercial gas discovery made at Jack Hamar 3-13
some 1 ½ miles to the south east (highlighting the potential for a multi well gas field at South
East Lost Hills).

Phase 2
• Present gas buyer with realistic gas deliverability
• Secure gas sales contract and pipeline easements
• Complete pipeline construction and tie-in to main gas line
• Install production equipment
• Get wells online
Phase 3
• Evaluate drilling opportunities on the basis of the work in phases 1 and 2.
Our target with current progress is to be connected into a major gas pipeline in 3 months.
The Work Plan going forward now for the oil:
Currently we are producing oil through 10 feet of perforations in the top Monterey Zone and
the best way to give an idea of our position is to quote our experts out of Bakersfield
California who stated:
"If Nuenco is able to prove the continuity of an oil saturated Monterey section
across the leased acreage, economically viable recovery of only 1% of the oil in
place (through modern fracturing, horizontal drilling, etc.) would yield plus 10
million barrels of oil. That is the immediate Nuenco challenge; to properly
assess the economic viability of Monterey producing wells on Nuenco acreage
through proper testing and further drilling."
We will be using the rig now on site to assess our gas wells before turning to Jack Hamar 1-1
and the plan for this and for the Monterey is to be developed in meetings to occur between
Orchard and Nuenco starting when I go to California next week.
North Yolumne:
As we announced on 28 April Nuenco is closely watching progress at North Yolumne with
testing over what may be one of the largest targets onshore in North America: a target with
the potential to contain 100 million barrels of recoverable oil. It is of interest to us because
Nuenco has a major shareholding in Statesman Resources Ltd (TSX code “SRR”) the
majority of which were bought with Nuenco shares valued at A$0.04 cents per share and the
Statesman shares have traded as high as CAD$4.00 per share with the success of North
Yolumne. More recently these shares have traded around CAD$3.70 (as they wait for
equipment at North Yolumne) but in any event the value of this shareholding equates to
approx 20% of NEO’s current market capitalization.
This strategic position gives us material exposure to success in the North Yolumne drilling
program which has the potential to be a large discovery. With oil at current prices, proving up
reserves at North Yolumne will add significant in ground value to Statesman’s 12.5% working

interest in this prospect and we believe that our shareholding in Statesman could become a
very valuable asset to Nuenco as we continue to build our inventory of assets in California.
Rights and Entitlements Issue:
We are heartened by the response to the rights and entitlements issue. These funds will
mean the Company is well capitalized going forward with the work program outlined above.
CONCLUDING REMARKS:
This is an exciting time for Nuenco shareholders. Nuenco is starting to produce positive
results including it’s first commercial well from its valuable California acreage in partnership
with Orchard at a time of record oil and gas prices. The investment in Statesman is also
proving successful and with the company cashed up and a drill rig on site, forward
momentum at the shallow gas and deeper oil prospects is likely to be brisk, and will result in
Nuenco being transformed from a pure explorer to a producer in quick time.
Yours faithfully
Anthony Kain
Managing Director
For further information please contact:
• The company on (+61 8) 9388 8431
Compliance Statement
The geological information included in this announcement is the technical assessment of the
available information by Mr Jack West, a qualified geologist employed as a technical
consultant to Nuenco. Jack has practiced as a geologist in the petroleum industry in California
for 44 years.