Block Z-1

completed

BPZ Resources, Inc. is a Texan corporation with offices in Houston, its subsidiary, BPZ Exploration & Production SRL has offices in Lima. Peru. BPZ is focused on exploration, development and production of oil and natural gas in Peru. BPZ owns a 10% non-operating working interest in an oil and gas producing property (Block 2) in the southwest region of Ecuador. The operations in Peru cover an area of 2.2 million acres located in the following blocks: Offshore: Block Z-1 (0.6 million acres), Onshore: Block XIX (0.5 million acres), Block XXII (0.9 million acres), Block XXIII (0.2 million acres). Under a testing program, wells have been drilled from the CX11 Platform in the Corvina field and the A Platform in the Albacora field, both located in the Z-1 Block. Oil has been produced and sold from the Corvina field under an extended well testing program since November 2007. The Albacora platform is located in Block Z-1, 29 km from the town of Zorritos and about 25 km from the port of Caleta Cruz. To date BPZ has drilled one operating well and two wells were abandoned during drilling. Produced oil is transferred to an FSO (Floating Storage Offloading) vessel from which it will be transferred to another vessel for transportation to a refinery in Talara. The Corvina platform is also located in Block Z-1, from which, to date BPZ has drilled eight (8) wells. Block XXII is located in the state of Piura and has an approximate area of 369,043 hectares. An Environmental and Social Environmental Impact has been developed for the 2D-seismic, however, activities for the seismic have not yet been initiated.BPZ’s Block XIX is located in the state of Tumbes, and has an approximate area of 191,441.161 hectares. BPZ has conducted an ESIA to drill wells in the block but to date BPZ has not commenced the development of the block.Block XXIII is also located in the state of Tumbes and has an approximate area of 93,128.96 hectares. BPZ has prepared an ESIA for the 2D-3D seismic in the Block. BPZ’s blocks are not located in protected areas, and BPZ will ensure to take preventive measures for restoration and re-vegetation in the areas of the seismic activities.