Chinook Energy Inc. (TSX:CKE) provide the following operational update on its Bir Ben Tartar ("BBT") concession.

TT16

The first horizontal well to be drilled targeting the Ordovician Bir Ben Tartar Formation in the Ghadames Basin of Southern Tunisia was completed on July 1, 2012 with the rig release of the TT16 well. Foradex Rig 14 completed the 42 day operation with no incident or accidents. Final measured depth of the well was 2,435 metres with a horizontal section of 950 metres. Gross drilling costs for the well approximated USD$7.0 million (net USD$6.02 million).

A Packer's Plus system was successfully run on the TT16 well in preparation for a multi-stage fracture stimulation of the Ordovician Jeffara and Bir Ben Tartar formations. Completion operations commenced on July 8, 2012 and fracturing operations were completed on July 15, 2012 after successfully placing a total of 385,285 lbs of sand over eight fracture intervals spaced along the 950 metre horizontal section. Chinook has successfully drilled out the frac ports, ensuring the well is open along the entire length of the horizontal section, and Chinook expects to commence flowing the well back within 48 hours.

The TT16 well is the first multi-stage, hydraulically fractured horizontal well in Tunisia. It is also the largest multi-stage job attempted by Schlumberger on the African continent. Despite the significant challenges associated with logistics, equipment, and manpower, the operation was completed successfully and represents a valid test of this recognized technology in a new application. The target reservoir on the BBT concession is a thick (up to 50 metres of pay column), low permeability (average close to one millidarcy permeability), heterogeneous clastic reservoir that demonstrates commercial flow rates from stimulated vertical wells. The application of horizontal wells in this low quality, conventional reservoir is an attempt to increase the rate per well and ultimate recovery relative to what can be achieved with fractured vertical wells.

TT13

On July 7, 2012, the Foradex Rig 14 spud Chinook's second horizontal well on the concession at the TT13 location. This well is approaching the intermediate casing point at the top of the Lower Jeffara formation from where Chinook plans to drill an 800 to 1,000 metre horizontal section with a final measured total depth of approximately 2,600 metres.

Matt Brister, Chief Executive Officer of Chinook, commented "We want to recognize the exemplary efforts of our operations staff, supervisory personnel and key service providers in successfully executing the drilling and completion operation of this critically important operation. The skill, effort and innovation demonstrated in achieving a number of "firsts" in Tunisia bodes well for the future application of multi-stage horizontal applications on our BBT oil project as we apply the key lessons learned to future wells."

Chinook expects to provide a further update on the completion operations at the TT16 well once a representative flow rate is established, which we expect could take seven to ten days, and on the drilling and completion operations at the TT13 well in due course.