Workover of Las Casas wells 1x and 2x – Licence 6-93

In order to carry out the workover operations required on the two existing wells, Las Casas 1x and 2x, a used Wilson service rig was purchased and shipped to Guatemala. On arrival, the age and condition of this rig indicated that extensive repairs were required to put it in safe working order. This rectification took two months. Since that time, the rig has been used to work over Las Casas 2x and 1x.

The work at well 2x has demonstrated that this well has little potential due to bad drilling practices, poor completion techniques and what appears to be damage from a poorly designed acid job at the time the well was originally drilled, completed and subsequently tested. This coupled with the prevailing reservoir characteristics has led us to believe that the well will not produce. Accordingly, the well is currently shut in and it is planned that it should be re-completed as a water injection well.

Following the completion of the 2x workover, the service rig was moved to Las Casas 1x to evaluate its potential. This well was swab tested and appeared to be capable of producing an estimated 100 barrels per day of fluid with approximately 70% 38.8º API oil with 4% to 6% emulsion. However, it has been determined that there is no cement behind the casing over the critical interval and, with approximately 350 feet of perforations and a casing leak 200 feet higher, we do not believe that the well bore can be used.

Additionally, the well has a number of 'doglegs' above the reservoir sections, which would have prevented a conventional pump test. As a result the well has been 'side-tracked' from just below the Coban A (5820 feet) and re-drilled to a target west south west of the original location.

Well 1XD Side-track

Well 1X was side-tracked to a total depth of 10,210’ (9956’ TVD). The well encountered gas and oil shows in intervals from approximately 7300’ MD to TD. Wireline logs indicate that there may be four potential pay zones; three in the Coban C with a total net pay of 36’ and one in the Coban B with 8’ net pay. In 2006, the Company tested the deepest of these zones. The results of these tests were that the well did not produce at commercial levels as a result of an apparent lack of energy in the reservoir. The well has now been suspended whilst further geological studies on the Las Casas structure are carried out.

Drilling of Well 3X

Well 3x was drilled to a total depth of 9300' the well encountered oil and gas shows while drilling and three pay zones were identified on logs. Two intervals have so far been perforated. The first interval produced 40º API oil during swabbing operations. Pressure recorders were then run over this interval. A second interval was also perforated and tested, but with a rapid decline in pressure and a serious wax formation problem in both intervals it was decided to shut in the well to monitor and analyse pressure build up data and redesign the pumping system.

Seismic Acquisition

150km of 2D seismic was acquired over licence 6-93 and processed in 2006.

Environmental Study

An environmental study over licence A7-2005 was sent to the Ministry of Environment in December 2005. Final approval of this was granted in June 2006. Contracts to access the area and land use rights were signed in September 2006.

Atzam 2 work over

The Atzam well was worked over in late 2006. The well encountered a strong pressure regime and oil flowed to surface. The work over also identified damage to the casing and cement work. The Company is therefore planning remedial work to the well bore to allow the well to be fully tested.

Tortugas Archaeological Study

The Company has carried out an archaeological study over the A7-2005 licence area. This has defined a Mayan city based around the Tortugas salt dome. Historically, this city appears to have been a major commerce site between the Southern and Northern Regions of the Maya civilization and was one of only three major salt producing areas within the Mayan territories. Initial evaluations conducted on this city indicate that it would have had an estimated population of around 25,000 with a variety of structures, tombs, playing fields and salt refining areas.

This survey, although funded by PetroLatina, is being supervised by a Guatemalan Archaeologist with Government of Guatemala supervision. There has been no real archaeological digging to date, just the mapping and recovery of surface located pottery fragments, figurines and other small Mayan artifacts, all of which are catalogued and stored with no input from PetroLatina. The Company takes its environmental and ethical responsibilities very seriously and is fully cooperating with the Government of Guatemala in the preservation of their heritage.