Pyramid Petroleum Announces Resumes Operations at Gulf of Mexico Offshore Facilities and Operational Updates: Financial News

Pyramid Petroleum Announces Resumes Operations at Gulf of Mexico Offshore Facilities and Operational Updates
Friday September 5, 2008 1:26 pm ET

CALGARY, ALBERTA--(MARKET WIRE)--Sep 5, 2008 -- Pyramid Petroleum Inc. (CDNX:PYR.V - News) today announced that after being shut down due to Hurricane Gustav, the Company has successfully completed its safety survey and has found that no material damage has been reported to its facilities in the Gulf of Mexico. Production has resumed on the High Island platforms; however, the Green Canyon platforms are waiting for third party transmission pipelines to come online before production can be resumed.

Pyramid also provided an update on previously announced operational activities:

- 4 well drilling program: The delay in commencement of drilling operations has been primarily due to the unavailability of a suitable rig. The operator has indicated that it has an opportunity to secure a rig and if successful, the drilling operation will commence within 30 days.

- 8 well workover program: To date, Pyramid has completed 3 workovers in the Green Canyon 184 field. The remaining 5 workovers will be spread between Green Canyon 52 and 184 and scheduled for 4th Quarter 2008. A brief summary on the 3 completed workovers:

1. A-10: Cleared debris and zone was re-perforated. Initial production 140 bopd with 10/64 choke. Well continues to produce at a rate of 140 bopd.

2. A-2: Cleared debris and oil flowed to the surface followed by emulsions. Currently, the well is being analyzed to determine the appropriate solution needed to liquefy the emulsions so that the well can flow without interruption. Initial production rate has not been determined as yet.

3. A-16: Cleared debris and re-perforated. Well did not produce from the existing zone. Currently under analysis to determine if other zones can be considered as candidates for perforation.

Pyramid has an ownership interest in some 16 platforms and 105 wells in Gulf of Mexico located in Green Canyon 52, Green Canyon 184, High Island 160, Vermilion 331 and Mustang Island 804. Pyramid operates the Green Canyon and High Island facilities with gross production exceeding 4,000 boepd at an average cost per BOE of $17. Pyramid's share of production from Gulf of Mexico operations is approximately 1,200 boepd. Pyramid has no debt and is deploying its cash flow for workover programs and drilling.

Disclaimers

Except for statements of historical fact, all statements in this press release, without limitation, regarding new projects and future plans and objectives are forward-looking statements which involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from those anticipated in such statements.

The TSX Venture Exchange has neither approved nor disapproved of the contents hereof.