substantial rise in net production : cash flow

This is good stuff..

Testing yields combined 3.4 mmcfd in Oklahoma.
Tomahawk Energy Limited (THK) is pleased to announce that it has now successfully tested two recent exploration wells, Priegel #1-10 (THK 33%) and
Patriot #1-15 (THK 12.5%) in its Bad Creek Project in Oklahoma.
The Jefferson Sand zones in the Patriot #1-15 and the Priegel #1-10 have tested at 1700 mcf of gas per day each and are both now in production and connected
to sales.
The net incremental production from these two wells will lead to a substantial rise
in Tomahawk’s net production and cash flow. THK’s production in Oklahoma has
now increased by more than 100% from these two wells alone, and the planned
increased pipeline capacity will soon increase production even further.
THK is currently embarking on an aggressive work-over and drilling program,
which is expected to continue to increase production over the coming months.
The Patriot #1-15 tested at 1700 mcfd but has been choked back to produce at
500mcfd due to pipeline constraints. A larger capacity gas line is being laid to
allow for full production that is expected to be between 750 and 1000 mcfd.
The Priegel #1-10 also tested gas flows of 1700 mcfd but has been choked
back to produce at 500 mcfd and will remain at this rate to optimize its
production and reserve potential.
Both the Patriot and Preigel wells have additional potential in multiple shallower
formations that remain to be tested. Additional drilling is planned to increase
reserves and production from the prospects.
A nearby analogue Jefferson sand gas field accumulated 4.5 BCFG from 4
wells and the company is encouraged at the initial similarity to the Patriot
discovery.
The company expects to drill at least an additional two to four Jefferson sand
offset development wells on the prospects to continue to raise production levels.
These wells combined with production data will provide a better assessment of
the reserve potential of the prospect.
2
The success of the Patriot #1-15 and the Priegel #1-10 endorses the decision of
the new Tomahawk Board, appointed 23rd May 2007 after the merger with K2
Energy Limited, to focus the exploration efforts of the company in the immediate
future on the conventional gas potential in the Bad Creek 3D Seismic Project
area.
The success of the first two wells drilled in the Bad Creek Project confirms the
potential of the project and the additional 20 targets that have been identified
from 3D seismic in the project area to date. The company will continue to
aggressively drill the targets, with a minimum of 10 new wells planned over the
coming year.
The work over program on the existing 30 THK wells is proceeding rapidly, with
work recently commenced on 9 well bores to access behind pipe resources in
those wells. In addition to the production from the new wells, the company also
expects increases in production from the work-over program on existing wells to
add to production revenue over the coming months.
TEXAS WELLS
Alex #1 (THK -7.5%)
The Alex #1 well in Hidalgo County Texas has resumed drilling, after delays due
to mechanical problems and stuck pipe. The well will be drilled to a total depth on
12,000 feet and is targeting 10-24 BCF of gas from 1-3 pay zones.
Gayle #1 (THK 7.5%)
The Gayle #1 well in Brazoria County spudded in late June and is drilling on at
8,900’.
The well is targeting multiple Frio sand formations with a reserve potential of 3-10
BCF and also has potential in deeper formations.
BOARD CHANGES
Messrs Mike Reed and John Thompson, who are directors of K2 Energy Limited,
have been appointed to the Board of the company. Mr. Reed is a Certified
Petroleum Geologist with the American Association of Petroleum Geologists, with
over 25 years of experience in oil and gas exploration in the United States. Mr.
Thompson has considerable experience as a director and manager of resource
and scientific companies.
Mr. Frank Brophy has resigned as a director of the company and the Board
wishes to thank Mr. Brophy for his contribution company during his tenure.
25th July, 2007