Sound Energy Regulatory News (SOU)

25 July 2012

Sound Oil plc

("Sound Oil" or "the Company")

Operations Update - Indonesia

Sound Oil, the upstream oil and gas company with assets in Italy and Indonesia, announces the following update on its Jatayu-1 well operations on the Citarum PSC in Java, Indonesia.

The well has been drilled in 6" hole to a depth of 6175 feet TVD (true vertical depth). The well encountered gas shows throughout this interval, utilising high mud weights up to 13.5 ppg (pound per gallon) due to the presence of over-pressured formations. Lost circulation was encountered while drilling at 6173 feet TVD, resulting in the decision to stop drilling and log the well.  The well site drill cuttings description indicated the lithology of the formation being drilled when losses occurred to be sandstone.  Very high mud gas readings were observed over this unit.

The Operator is currently running a cement plug at the bottom of the well where mud losses were observed and will then drill ahead to a suitable point to determine whether a more permeable reservoir is present and then log the well. In the event that it is not possible to cure the drilling fluid losses, a revised forward programme for the well will be issued by the Operator.

Gerry Orbell, Sound Oil's Chairman and Chief Executive commented:

"Jatayu is proving a very problematic well with gas shows over a 600 feet interval and with zones of different pressures. The hole condition makes wireline logs difficult to interpret although we are encouraged by our own analysis that indicates several units with reservoir potential".

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Note:

1. The information contained in this announcement has been reviewed by Sound Oil's Chief Operating Officer, Dr M. J. Cope BSc PhD CGeol FGS, a qualified petroleum geologist.