HispanicBusiness

West Bakr, Arab Republic of Egypt (100% working interest, operated)

Operations and Exploration

The Company drilled two wells during the fourth quarter resulting in one oil well in the K field and one dry hole in the M field.

Subsequent to the quarter, the Company has drilled two oil wells in the K field and one oil well in the M field.

The rig is currently moving to drill in H field.

To date the Company has drilled and completed four directional wells in the K field targeting multiple stacked Asl sands below the main Asl A zone with wells being completed in the lower-most oil formations. Depending on the performance of the respective wells/pools they may be recompleted or possibly commingled with additional Asl sands not currently producing. All four wells encountered oil pay in the main Asl A sand with an average true vertical depth ("tvd") net oil pay of approximately 113 feet per well and oil pay in the Asl B sand with an average tvd net oil pay of approximately 65 feet per well. The Asl A sands appear to be relatively un-swept in the main Asl A reservoir. The wells encountered the Asl B reservoir in a structurally favorable position and have a common oil water contact. One of the four wells was completed as an Asl B oil well and was placed on production at an initial pumping rate of approximately 800 Bopd in mid February. Additional oil pay was encountered in the thinner Asl D, E & F sands depending on the structural position of the respective wells. One well is completed in the Asl D, one well in the Asl E and one well in the Asl E and F sands with an overall average production pumping rate of approximately 240 Bopd per well. The Asl formations are high quality, unconsolidated sandstone reservoirs which typically produce sand with the oil during the initial production phase resulting in an increased frequency of pump changes and sand cleanouts.

Additional vertical K field wells targeting the main Asl A pool are planned to recover un-swept oil in the K field. The Asl A pool has produced approximately 28 million barrels of oil since being discovered in 1980, or approximately 17% of the internally estimated 169 million barrels in place. At year-end 2012, approximately 4.5 million barrels of proved plus probable ("2P") remaining reserves were assigned to the Asl A pool which, combined with historical production, equates to an ultimate recovery factor of approximately 19%. Management believes an additional 10 to 20% recovery factor for the K field Asl A pool is possible primarily through infill and down-spaced drilling opportunities. This could increase the ultimate recovery to the 30-40% range which is a more typical recovery factor for a high quality sandstone reservoir with an active water drive.

It is expected that the drilling rig will continue working in West Bakr throughout 2013.

Production

Production from West Bakr averaged 4,730 Bopd to TransGlobe during the fourth quarter, a 3% (140 Bopd) increase from the previous quarter.

Production averaged 4,126 Bopd in January and 4,199 Bopd in February. January and February production was significantly impacted by a higher than normal number of pump changes and sand cleanouts. In addition, a significant producer in the M field was down during most of January and February due to remedial work required to address an increase in water production. The well will be placed back on production this week along with a new oil well in the M field early next week. West Bakr production has averaged approximately 4,500 Bopd to-date in March, and is expected to be in the 5,000 to 5,500 Bopd range by month end.