Turkey - Thrace Basin

• Proven hydrocarbon province with robust local energy markets
• High gas price ~US$14.70/mcf 
• Low government royalties
• “Exploration friendly” (shallow targets, good access to infrastructure)
• Low sovereign risk, well developed legal and commercial code (EEC applicant)
• In March 2007, Otto sold 30% in Edirne and 60% of Catalca and Ortakoy to Incremental Petroleum (ASX: IPM) for US$5.5 million. 
• Otto is using the funds to continue exploration activities and development of the discovered fields.

Edirne Licence (Otto 35%)

• The 2008 drilling campaign commenced in March was completed in June 2008.
• The joint venture had 100% exploration success rate with 4 discoveries made from 4 wells drilled. 
• So far three of those wells have flowed dry gas to surface at commercial rates: Ikihoyuk-1, Kuzey-Arpaci-1 and Arpaci-2A. 
• A work program is currently being developed with the construction of surface facilities to be completed and first gas sales anticipated by mid 2009.
• Gas marketing studies are ongoing and the JV has applied for a gas wholesale licence.

	Satellite Photo - Turkey & Thrace Basin Licence location and infrastructure of Thrace Basin (click to enlarge)

ITALY

Otto has an agreement to farm-in to earn 50% working interest in the Bastiglia-Cento Exploration Permits in the Po Valley, Italy, from Ascent Resources Plc.

The two adjacent Bastiglia - Cento Exploration Permits, are considered highly prospective and have multiple hydrocarbon prospects and leads already identified from previous seismic data. 

The first well, Gazzata-1, is scheduled to be drilled mid to late October/early November 2008 and will target prospective gas resources of over 100bscf. 

Deltana Energy Limited had an option to earn a 15% working interest that could be exercised up to March 2008. They did not exercise their option so Otto will earn the full 50% by the funding on the Gazzata-1 well.