PAE G San Jorge

completed

PAE is the second largest oil and gas producer in Argentina and has blocks located in the four major hydrocarbon basins: Golfo San Jorge, Austral, Neuquina and Northwest. The most significant block in terms of both reserves and production is the Cerro Dragon block in the Golfo San Jorge basin, located in the south of Argentina which is the main subject of this investment.Loan proceeds will fund the further development of PAE’s assets, Cerro Dragon, Piedra Clavada and Koluel Kaike in the Golfo San Jorge Basin (UG-GSJ) or “the Project”. The Project will partially fund part of the 2009 investment program which includes: drilling of 172 new production wells and 52 injection wells; b) three new projects for secondary recovery and expansion of existing projects; c) expansion of the on-site power generation capacity up to 40 MW; d) expansion of the two crude treatment plants and their pumping systems; e) approximately 80 programmed well interventions.