Mr. Scott Koyich reports

TRANSGLOBE ENERGY CORPORATION ACQUIRES WEST BAKR CONCESSION AGREEMENT IN EGYPT

TransGlobe Energy Corp. completed the West Bakr acquisition in the Arab Republic of Egypt from the Egyptian Petroleum Development Co. Ltd. (of Japan) on Dec. 29, 2011. All dollar values are expressed in United States dollars unless otherwise stated.

The transaction highlights include:

• $60-million all-cash deal, effective July 1, 2010, with operatorship of three fields with 28 producing wells, financed with working capital;
• Immediately accretive to funds flow from operations and net income;
• 100-per-cent working interest in 4,350 barrels of oil per day of production;
• 45.2 square kilometres (11,600 acres) in two development leases;
• Located immediately adjacent to TransGlobe's existing West Gharib development leases;
• Integration opportunities with the TransGlobe West Gharib operations;
• Numerous development optimization projects identified.

West Bakr, Egypt (100-per-cent-operated working interest)

TransGlobe West Bakr Inc. (TGWB), a wholly owned subsidiary of TransGlobe Energy, has acquired all the Egyptian assets of the Egyptian Petroleum Development Co. Ltd. (of Japan) (Epedeco) for $60-million plus or minus adjustments, effective July 1, 2010. TransGlobe financed the acquisition with working capital.

TGWB holds a 100-per-cent working interest in the West Bakr production-sharing concession (PSC). TGWB is the operator of the West Bakr concession through its joint venture operating company (West Bakr Petroleum Company).

The West Bakr PSC is located onshore in the western Gulf of Suez rift basin of Egypt adjacent to TransGlobe's West Gharib concession. The two West Bakr development leases encompass 45.2 square kilometres (approximately 11,600 acres) and are valid until 2020 with an optional five-year extension to 2025. Modern 3-D seismic covers the development leases. Current gross oil production from the three producing fields is approximately 4,350 barrels of oil per day (bopd) (approximately 1,240 net bopd after the production-sharing split with the government of Egypt). There are three oil fields on the lands with cumulative production of approximately 50 million barrels of oil. The company has identified a number of optimization/development projects and drilling opportunities that could increase production and recoverable reserves.

Production

TransGlobe's total production including the West Bakr acquisition is approximately 16,250 bopd (West Bakr -- 4,350 bopd, West Gharib -- 11,500 bopd and block 32, Yemen -- 400 bopd). Approximately 700 bopd is curtailed at West Gharib and 2,250 bopd of production from block S-1 Yemen is shut in due to damage to the export pipeline (announced Oct. 8, 2011).

We seek Safe Harbor.