Transeuro Energy Announces Drilling Update in Ukraine

Transeuro Energy announced updates on our drilling operations in Ukraine. The intermediate section of the Karlavskoye 101 well ("Karl-101") has been successfully drilled to a depth of 2934m and the rig is preparing to run casing prior to drilling the main section. Significant gas shows were identified in the intermediate section with up to 11% gas by volume in the drilling fluid. The well is expected to encounter the Turonian formation at a depth of around 3000m which has the potential to be oil bearing, followed by the 5 primary target intervals of the Cenomain formation which are expected from 3200m to the planned total well depth of around 4200m.

Also in Ukraine, the Company has commenced construction of the rigsite to drill the Povorotnoye 104 well ("Pov-104") in East Crimea on the Kerch Peninsula. The Company expects to spud the well in the first half of 2008. The well is targeting the Maykop III and Maykop IV reservoirs which are anticipated at a depth of 3900m. Two adjacent old wells #1 and #2 drilled on the Povorotnoye field reported gas test rates of 5 million cubic feet per day ("mmscf/d") and 17 mmscf/d respectively. These wells are located some 500m either side of the planned Pov-104 well location. The field is located within 3km of the main gas line in Eastern Crimea which was completed in early 2002. Licensing of the land to build a gas processing plant is underway.