Jadela's El Indio #1-H Eagle Ford well that was completed with a GasFrac propane frack or LPG frack was tested over the past couple of weeks. The companies injected over 225,000 gallons of liquid propane and butane into the formation. The well test results are a little difficult to interpret because production was limited by the LPG fluid recovery system. The most recent 24 hr period produced 210 barrels of oil and 706 mcf. It's still early to declare success, but those aren't bad numbers for Maverick County, TX. It will be interesting to see just how much propane and butane Jadela was able to recover. LPG's are expensive frack fluids, but you get to resale the fluid if it can be recovered.

Jadela Oil Corp. wishes to announce that the El Indio #1-H well produces oil, gas, butane and other hydrocarbons. Approximately 5,360 barrels of liquid propane/butane were injected into the formation to fracture the well. The majority of this propane/butane is expected to be recovered and resold or used for fracturing subsequent wells. The well was flowed for 58.75 hours from August 27, 2011 to August 31, 2011. The well was then shut in in order to test the purity of the recovered propane/butane for resale purposes. The well was reopened on September 3, 2011 and is currently producing. The well is expected to be produced for the next 7 to 10 days while the tie-in pipeline and permanent treatment facility, storage tanks and trucking terminal are being constructed.

The permanent treatment facility/trucking terminal is located two miles away from the El Indio #1-H wellsite on Highway 1021. Oil flow and gas flow are restricted by the capacity of the propane/butane recovery equipment. As of September 6, 2011 (6:00am)(122.75 flowing hours) the well had produced 969 bbl of oil (210 bbl in last 24 recorded hours) and gas of 13.978 MMscf (0.706 MMscf in last 24 recorded hours) or alternatively stated a boe/d of approximately 327 boe/d (for last 24 recorded hours) from a 2,400 foot lateral with an 8 stage frac (2 of which were not fully fracced) with the flow rate choke restricted to 10/64 of an inch. The oil recovery rate is increasing as the propane/butane from the frac is recovered. Jadela is in the process of acquiring additional equipment to increase the propane recovery rate.

When drilling El Indio #1-H, Jadela drilled a pilot hole and logged the pilot hole with the following log suites: DSL/HDIL/ZDL/CN/GR/Sonic. A total of 25 sidewall cores were obtained over the 186 foot Lower Eagleford formation. In the El Indio #1-H wellpath/frac zone (excluding certain anomalous results) the lab results as prepared by Core Laboratories LP (independent laboratories) showed TOC of 5.0 - 6.5% with a carbonate percentage of 50 - 60%. Total (ambient) porosity (MR Shale TM Analysis - Core Laboratories LP) ranged from 10 - 15% and total percentage pore volume occupied by oil ranges from 37% to 79%. The oil produced has an API gravity of 40.3 degrees according to Fesco, Ltd (independent engineers).

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