Operations Update

RNS Number : 2730L
Petrolatina Energy PLC
07 January 2009

7 January 2009

PetroLatina Energy Plc
("PetroLatina" or "the Company")

Award of Exploration Block, Proposed Farm-Out Agreement

and

Operations Update re Colon-1 Exploration Well

PetroLatina (AIM: PELE), an independent oil and gas exploration, development and production company focused on Latin America, is pleased
to announce that Colombia's hydrocarbon regulatory agency, (the Agencia Nacional de Hidrocarburos ("ANH")), confirmed on 26 December 2008,
that Petroleos del Norte S.A. ("PDN"), PetroLatina's wholly owned Colombian operating subsidiary, was the successful bidder for the
Putumayo-4 block in the recent Colombian licence bidding round 'Mini-Ronda 2008'.
The Putumayo-4 block covers an area of 51,333 hectares located in the Putumayo Basin of southern Colombia and has over 400km of
pre-existing 2D seismic data from which PetroLatina has already identified promising leads. The Putumayo Basin is considered by ANH to be
one of the most promising exploration areas in Colombia and is rapidly becoming a prolific hydrocarbon producer with companies such as Gran
Tierra Energy Inc., Petrominerales Ltd. and Ecopetrol S.A. amongst others operating in the region.
Under the proposed terms of the exploration and production contract (the "E&P Contract") with ANH, PetroLatina will be required to shoot
a minimum of 103km of 2D seismic data and to drill at least one exploratory well within the first three years of the work programme.
PetroLatina's proposal for the Putumayo-4 block also included additional work commitments, comprising US$1.6 million in additional seismic
work, and a 1 per cent. net production revenue payment after royalties to ANH. The E&P Contract comprises two 3 year exploration phases and
a 24 year production phase.
PetroLatina expects to finalise and sign the formal E&P Contract with ANH during the first quarter of this year.
In addition, through PDN, PetroLatina has also entered into a memorandum of understanding for a proposed farm-out agreement for the
project with La Cortez Energy Inc. ("La Cortez") (OTC: LTCZ), an early stage oil and gas exploration and production company currently
focusing on the energy sector in South America. Pursuant to the terms of the proposed farm-out agreement, La Cortez will assume two-thirds
of the cost of the first seismic campaign (estimated to be US$2.6 million), which will be reimbursed in full by PetroLatina should the
initial exploratory well ultimately prove to be a producing well. La Cortez will also be entitled to a 50 per cent. Net Working Interest in
the Putumayo-4 block. The proposed farm-out agreement is intended to be finalised shortly after signature of the E&P Contract.
Operations Update
Further to the announcement made on 1 December 2008, PetroLatina is also pleased to provide an operational update in respect of the Col?
exploration well.
The Company previously announced the commencement of drilling operations on Colon-1, the first exploratory well to be drilled on the La
Paloma block, with an expected total drilling depth of 9,072ft in order to test the La Paz, Lisama and Umir formations. The well has to date
been drilled to a total depth of 8,825ft. At 6,700ft a gas show was registered in the Eocene La Paz Formation and at 8,700ft good oil shows
and gas were observed in the Cretaceous Umir Sandstones. At a depth of 8,825ft, the current drilling program had to change as a result of
the overpressure zone penetrated in the Umir formation and a cement plug has now been set up in the original hole at a depth of
approximately 2,275ft. A side track has been started at 2,370ft in order to reach an intended revised target depth of up to approximately
9,200ft. This side track operation is expected to result in an increase of approximately US$1.6 million in the original projected costs of
US$6 million, but the Directors of PetroLatina remain encouraged by the well's progress to date.
The remaining programme, including completion of the side track drilling operation to a total depth of approximately 9,200ft (about 41m
from the original bottom coordinates), wireline logging and initial production testing, is expected to take a further 12 days to complete.
The Company retains an 80 per cent. working interest in the Col? well and is the operator.

Juan Carlos Rodriguez, CEO of PetroLatina, commented:

"PetroLatina is delighted to have secured this block in a proven hydrocarbon basin with exceptional exploration potential. The award
underlines the reputation and technical abilities of our operational team in Colombia. This has been further evidenced by the proposed
farm-out agreement with La Cortez which substantially reduces the exploration risk for our shareholders."

"We remain excited by the potential of the Coln-1 prospect which we believe has possible recoverable reserves of up to 19.8 million
barrels of oil. We hope to be able to announce initial production testing results in the coming weeks following completion of the side-track
process."

Enquiries:
PetroLatina Energy Plc
Juan Carlos Rodriguez, Chief Executive Officer / Tel: +57 1627 8435 /
Sebastien Garnier, Chief Financial Officer + 44 7525 009616
Pawan Sharma, Executive Vice President - Corporate Tel: +44 (0)207 956 2821
Affairs
Strand Partners Limited
Simon Raggett / Matthew Chandler Tel: +44 (0)20 7409 3494

Financial Dynamics
Ben Brewerton / Susan Quigley Tel: +44 (0)20 7831 3113

Additional Information on PetroLatina Energy Plc:
PetroLatina Energy Plc (AIM: PELE), formerly known as Taghmen Energy Plc, was founded in 2004. The Company is presently focused on
Colombia after the sale of its assets in Guatemala in which it retains a 20% interest in the first three wells and a 20% working interest in
future wells. In Colombia, the Company currently holds 40% and 20% interests in the Los Angeles and Santa Luc?fields on the Tisquirama
licence respectively, and a 100% interest in the Do?ar?field. In November 2007 the Company secured the extension of the Tisquirama licence
for the economic life of the fields. In April 2006 the Group acquired an interest in two exploration blocks with an 85% interest in Midas
and an 80% interest in La Paloma. PetroLatina also owns the R?Zulia-Ayacucho pipeline in the prolific Catatumbo basin which transports crude
oil. Present exploration/exploitation activities in this area should increase the volume of crude oil transported resulting in an increased
cash flow. Further information is available on the Company's website (www.petrolatinaenergy.com).

This information is provided by RNS
The company news service from the London Stock Exchange

END

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