ANNOUNCEMENT TO THE AUSTRALIAN STOCK EXCHANGE: 10 FEBRUARY 2006...

ANNOUNCEMENT TO THE AUSTRALIAN STOCK EXCHANGE: 10 FEBRUARY 2006


Zones of interest to be tested in North Yowlumne ST-1

Salinas Energy Limited is pleased to announce that a flow test program will be
conducted in the North Yowlumne sidetrack-1 exploration well after identification of a
number of zones of interest on evaluation (electric) logs.

Although hole conditions prevented a full suite of electric logs from being run, a number
of sandstone units within the target section appear to be porous and are characterised
by high resistivities on the logs indicative of the presence of hydrocarbons.

Initial interpretation of the well data suggests that a sequence of sandstone beds with
character similar to that predicted pre well have been penetrated and it is anticipated
that three separate zones will be tested for hydrocarbon content and flow potential.

The test program will be conducted after running 4= inch casing to protect the open hole
between the 7 inch casing point at 11,938 feet and total depth (13,102 feet). Further
details of the test program will be released once finalised.

The well is testing a large oil prospect on the South Buena Vista lease area (in the San
Joaquin Basin in California) in which Salinas Energy is earning 25.0%. The prospect has
potential for a resource of over 100 million barrels of recoverable oil and is immediately
adjacent to the 113 million barrel Yowlumne oil field.

Drilling of the prospect is consistent with the Company's exploration strategy to focus on
strong flow rate reservoir targets in prospects with substantial oil reserves potential.

Salinas is funding 50% of the cost of the well to earn its 25% interest. Partners in the
South Buena Vista project are:

- NEG (Operator of the initial exploration well) 12.5%
-
Ivanhoe
Energy
50.0%
-
Salinas
Energy
25.0%
-
Statesman
Exploration
12.5%


Enquiries- Managing Director: John Begg

Contact Details: Telephone: 0419 903 268
Facsimile:
08
9322
6558





The geological information in this report was compiled by Mr John Begg BSc, who is Managing Director of the
Company and is a petroleum geologist with over 26 years of relevant experience. Mr Begg consents to the inclusion
in the report of the matters based on his information in the form and context in which it appears.