Citadel Exploration Inc. announced that its first well at Project Indian, the Indian #1-15, has been producing approximately six barrels of oil per day, over the past seven days. This is the first oil ever produced on this structure after over 100 years of exploration efforts in the area by Standard Oil and Chevron Corp. The Indian #1-15 well data supports Citadel's predrilling geologic model.

Citadel believes its 688 acre lease contains an unrisked resource potential of 100 million barrels of original oil in place (OOIP). Historically, thermal recovery methods in California have proven to recover 20-60% of the OOIP. Citadel will now move into Phase II of the project.

Phase II will include preparing a complete Environment Impact Report (EIR) for full field development which will likely require several hundred wells. Additionally, the company is working with its engineers to procure the long-lead items required for commercial production. These items include the purchase of a steam generator, heated production facilities, a reverse osmosis water system and construction of an approximate one mile of pipeline to connect to the existing natural gas system in the area.