CanArgo Energy Corporation: Manavi 12 Acid Fracturing Update

Wed Dec 5, 2007 4:59pm EST

* Reuters is not responsible for the content in this press release.

  GUERNSEY, CHANNEL ISLANDS, Dec 05 (MARKET WIRE) -- 
 CanArgo Energy Corporation ("CanArgo" or the "Company") (AMEX: CNR)
(OSLO: CNR) today issued an operational update on the planned acid
fracturing stimulation program for the Manavi 12 well in Georgia.

    Following the recent visit by a Schlumberger representative to Georgia,
Schlumberger have now confirmed that the pumping and ancillary equipment,
the coiled tubing unit and the nitrogen unit which are required for the
hydraulic acid-fracturing of the M12 well, drilled to appraise the Manavi
Cretaceous oil discovery, are available for mobilisation. The equipment
is located in four different countries and, as a result, Schlumberger's
shipping agent will only be able to commence the coordinated mobilisation
process on December 19, 2007. It is anticipated that it will take up to
three weeks for the equipment to arrive on site at M12.

    The acid required for the stimulation operation has arrived in Georgia
and has been delivered to the well site. In the meantime, well
preparation operations at M12 are well advanced. The temporary plug has
been set in the well and this will allow for the correct placement of
acid across the desired carbonate reservoir interval during the
fracturing operation. Laboratory tests performed by Schlumberger have
shown that cuttings samples from this interval demonstrate very high
solubility in acid, thus confirming that acid fracturing is the best
option to stimulate this type of formation. The 5" workstring required to
help maximise pumping rates and the packer have been run in the well. The
operator is now preparing to set the packer and pressure test the
completion, after which the well will be fully ready for the acid
fracturing job.

    Vincent McDonnell, President and Chief Executive Officer commented, "I am
pleased that we have finally obtained a firm date for the mobilisation of
the fracturing equipment to Georgia so that we can finalise our plans and
proceed with operations at M12. The considerable engineering and
technical input which has gone into preparing the well for the fracture
stimulation and into the treatment design itself should minimise any
operational risk in achieving the desired stimulation and thus enable us
to properly flow test the well. We can now look forward to the continued
testing of this potentially significant new oil discovery at Manavi which
should take place during January 2008."

    CanArgo is an independent oil and gas exploration and production company
with its oil and gas operations currently located in Georgia.

    The matters discussed in this press release include forward-looking
statements, which are subject to various risks, uncertainties and other
factors that could cause actual results to differ materially from the
results anticipated in such forward-looking statements. Such risks,
uncertainties and other factors include the uncertainties inherent in oil
and gas development and production activities, the effect of actions by
third parties including government officials, fluctuations in world oil
prices and other risks detailed in the Company's reports on Forms 10-K
and 10-Q filed with the Securities and Exchange Commission. The
forward-looking statements are intended to help shareholders and others
assess the Company's business prospects and should be considered together
with all information available. They are made in reliance upon the safe
harbour provisions of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. The Company cannot give assurance that the results will be
attained.

Contacts:
CanArgo Energy Corporation - USA
Sabin Rossi
VP External Affairs and Investor Relations
(617) 973-6441
(617) 973-6406 (FAX)
Email: sabin@canargo.com

Gambit H&K AS - NORWAY
Eric Cameron
+47 (22) 048206

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