| April 15, 2007 | | | | premium of 15% to earn 10%. Through this partnership |
| Zappa Resources (TSX.V:ZPA) is a junior resource | | | | Zappa can operate in an environment with excellent |
| company with projects in Canada, the U.S. and now, | | | | potential like Tunisia, which would otherwise be out of |
| Tunisia. Early in March 2007, Zappa signed a letter of | | | | range for a junior company.” |
| intent to enter into a “farm-in participation | | | | According to Gerry, who believes in capitalizing on |
| agreement” with Pennine Petroleum on the Jorf | | | | sound economic opportunities, Tunisia is home to |
| concession petroleum property in Tunisia. The | | | | substantial known oil and gas reserves, and perfectly |
| opportunity, says Albert Gerry, President and CEO, | | | | suits Zappa’s exploration philosophy. “Tunisia is |
| has “large elephant” potential that has caught | | | | relatively hot in oil and gas market exploration field. |
| the enthusiasm of the investing public and propelled | | | | It’s gone from an insignificant amount of [known] oil |
| Zappa’s stock, which was at less than ten cents a | | | | and gas to a significant amount, in a very short period |
| share in February, up to twenty-two cents a share | | | | of time because the country was overlooked. [In the |
| today. | | | | past] there were known oil fields in Algeria and Libya |
| The deal involved Zappa paying US $250,000 upfront | | | | on either side [of Tunisia], and there was incentive to |
| to pay for its share of a seismic program, while paying | | | | explore in those countries. The Tunisian Ministry of oil |
| for 15% of drilling and developing costs. In return, Zappa | | | | and gas exploration (ETAP) developed a strategic plan |
| receives 10% working interest in the first identified | | | | and the country has attracted many foreign oil |
| drillable structure on the Jorf permit, and has the option | | | | companies.” According to Gerry, the Tunisian |
| of farming in on any subsequent drillable structures | | | | government is actively looking to partner with |
| under the same terms. The permit, which includes | | | | successful oil companies who find oil in their country. |
| 989,267 acres in south central Tunisia, is held by | | | | Also important is the pipeline that already crosses the |
| Cygam Energy Inc. of Alberta under its subsidiary | | | | Jorf permit, so if Zappa does hit the operator can tap |
| company, Rigo Oil Company Ltd., which is the operator | | | | into the pipeline to bring their oil and gas to market. The |
| out of Tunisia. | | | | existing pipelines have the capacity to transport oil to |
| Relying on analysis from Chapman Petroleum | | | | tankers or utilize the TransMed to deliver into the |
| Engineers, Gerry explains “why this particular oil | | | | European market. |
| target is so exciting is the Permian Reef. There are | | | | Gerry says that the Tunisia property is possibly an |
| only two other Permian Reefs that are known in the | | | | enormous reserve worth a large amount of money, |
| world and both of them are now producing oil and | | | | but costs are the same to develop as a smaller |
| have a great, great reserve. They’re both in the | | | | reserve. Zappa is confident that they have the |
| billion barrel reserve category. So, this may be another | | | | expertise and connections to raise enough money to |
| one. The reef itself is about 1000m thick in places.” | | | | stay put in Tunisia if necessary, so they might as well |
| He is referring to reefs in the West Texan Basin and | | | | put their money toward something big. Gerry explains, |
| the northern Caspian fields in Khazakhstan, both of | | | | “You can spend the same amount of money on a |
| which represent very large oil reserves. | | | | reserve that produces a hundred barrels a day and |
| Getting into the new Tunisian oil exploration market | | | | has a total reserve of two or three million barrels. The |
| was a boon for Zappa. “What we do is we ride | | | | Jorf permit could have half a billion barrels or more.” |
| the coattails of an experienced company that’s | | | | Gerry hopes that this is the kind of opportunity that |
| already been there. Through an introduction by | | | | creates a company overnight. He says Zappa will |
| Pennine, we partner with Cygam and their Tunisian | | | | know more by the end of July once they’ve |
| operating company Rigo. It saves a lot of time and | | | | started drilling. With that kind of potential we can see |
| money to have these relationships and we pay a | | | | why he talks in terms of elephants. |