On October 16, 2008 Calvalley signed a Production Sharing Contract ("PSC") (46,470 km²) with the Ethiopian Government to undertake exploration on the two blocks (Metema and Gimbi) that constitute the PSC. The two blocks lie adjacent to the Sudan border, offsetting the Melut/Muglad and Blue Nile Basins, both of which are proven oil basins.

Ethiopia represents an opportunity for Calvalley to diversify its operations outside Yemen. Calvalley has completed the early stage activities for the establishment of its presence in Ethiopia and preliminary geological work which will be utilized to direct future exploration efforts. As each phase of geological work is completed, the next phase becomes more targeted and more technical. Additional geological work planned for 2010 and 2011 includes an aeromagnetic survey and a seismic program to identify a location for the first exploration well to be drilled in 2011 or 2012.

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Figure 12

Figure 12

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Figure 13

Figure 13

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Figure 14

Figure 14