Mr. Chayan Chakrabarty reports

BENGAL ENERGY ENTERS INTO LOI FOR PATH TO PRODUCTION AT RAMSES 2 OIL WELL

Bengal Energy Ltd. has entered into a non-binding letter of intent with an Australian energy service company to finance and execute a production test and potential completion, equipping and tie-in of the Ramses 2 oil well in PL 188, Cooper basin, Queensland, Australia. Bengal currently has a 100-per-cent interest in PL 188, including wells Ramses 1 and Ramses 2. The oil zone completion will be carried out on the currently shut-in Ramses 2 well from the Jurassic-aged Poolowanna formation, which recovered an extrapolated 588 barrels per day of 37-degree API oil based on a 105-minute drill stem test period when it was drilled in 2007.

Under the proposed transaction, the investor will fully finance the production test, and, if the investor determines that testing results support commercial viability, the well will be completed, equipped and tied in for production, pursuant to a service contract between Bengal and the investor. Bengal will be fully carried on the expenditures of any such completion, equipping and tie-in of the well, and will retain 100-per-cent operatorship and ownership of the licence. Upon successful completion and commencement of production, revenue from the well will be shared 75 per cent to the investor and 25 per cent to Bengal until recovery of the investor's costs, after which revenue will be shared 50/50 between the parties. The LOI also provides that the investor is to be granted an option to earn an up-to-50-per-cent interest in the broader PL 188 by financing an additional exploration or appraisal well within 12 months of production commencing from the Ramses 2 well.

President and chief executive officer's message

"I am encouraged to announce this potentially transformative partnership with a leading Australian energy services company," said Chayan Chakrabarty, president and CEO of Bengal. "This transaction will allow for a carried solution that could derisk and accelerate production from our high-potential Ramses asset with no capital outlay from Bengal. We would expect that the investor's full funding of the test and completion will not only fast-track near-term cash flow but should also validate the tremendous upside we see in our Australian portfolio.

"By maintaining full operatorship and licence control while securing a 50-per-cent net revenue share postcost recovery, we are working to create substantial shareholder value without diluting our equity position. This prospective deal perfectly aligns with our strategy of leveraging smart partnerships to work to develop our assets and to deliver strong returns in a capital-efficient manner. We are excited to move rapidly into the negotiation of definitive agreements, commence operations and to work to achieve first oil from Ramses 2."

The transaction is subject to the completion of acceptable mutual due diligence and the negotiation and execution of mutually acceptable definitive agreements. The parties have commenced due diligence and are working toward finalizing binding documentation within the 60-day binding exclusivity period granted under the LOI.

About Bengal Energy Ltd.

Bengal is an international junior oil and gas exploration and production company with assets in Australia. The company is committed to increasing shareholder value through international exploration, production and acquisitions. Bengal's common shares trade on the Toronto Stock Exchange under the symbol BNG.

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