Coastal Energy Announces Spudding of Songkhla A-01 Well

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UNITED STATES NEWSWIRE SERVICES


Coastal Energy Company ("the Company" or "Coastal Energy") (TSX
VENTURE:CEN)(AIM:CEO), an independent exploration and production company with
assets in Southeast Asia, announces that the Songkhla A-01 well was spudded on
Wednesday, 8 October, 2008. Songkhla A-01 is the first well in the Company's
development program of the Songkhla field located in Block G5/43 offshore
Thailand.


The Company plans to drill Songkhla A-01 to a total depth of approximately 8,500
feet (2,590 meters) true vertical depth. The well is a direct offset to the
original Songkhla #1 well which was drilled in 1988 and tested at 1,500 barrels
of oil per day from 80 feet of net oil pay in the Lower Oligocene formation. A
Competent Persons Report ("CPR") prepared by Huddleston and Co., Inc. estimates
the Proven and Probable reserves in the main Songkhla feature to be 4.9 mmbbls.
The Company plans to drill four (4) wells on the main Songkhla field and conduct
production testing using natural flow and Electric Submersible Pumps ("ESPs").
Testing of the initial Songkhla A-01 well is expected to begin prior to the end
of October.


Randy Bartley, Chief Executive Officer of Coastal Energy commented: "We are
excited to begin our development of the Songkhla field. We continue to
anticipate completion and testing of Songkhla A-01 by late October and an
extended production test while continuing simultaneous drilling operations. This
is an important step in the Company's multi-well development of Block G5/43 and
toward commencing production at Songkhla by year end 2008."


Randy Bartley, President and Chief Executive Officer of the Company and a member
of the Society of Petroleum Engineering, and Frank Inouye, Chairman of the
Company and a member of the American Association of Petroleum Geologists, have
reviewed the contents of this announcement.


Notes to Editors

- Coastal Energy is an oil and gas exploration, development and production
company, with core assets onshore and offshore Thailand


- The Company specialises in identifying and developing under-exploited or
"orphaned" assets. Management has proven experience at identifying and unlocking
value from overlooked, abandoned, low risk assets with proven hydrocarbon
potential


- This strategy has enabled the Company to assemble an asset base in Thailand
that includes production of approximately 11.5 mmcf/d of gas under long term
contract and offshore oil fields currently under development


- Production growth over the next 12 -18 months is expected to grow
exponentially and proven, probable and possible reserves are 45.5 million
barrels oil equivalent(i)


- The Company's current assets include:

-- Offshore Thailand

--- 100% of block G5/43 - two oil fields currently under development with
several other appraisal and exploration opportunities. Production is expected to
commence Q4 2008


--- 100% of block G5/50 - within the boundaries of block G5/43 in the Ko Kra basin

-- Onshore Thailand

--- 12.6% net interest in blocks EU1 and E5N which include the Phu Horm gas
field, which was producing in excess of 100 mmcf/d at the end of the second
quarter 2008.


--- 36.1% net interest in block L15/43 surrounding the Phu Horm field

--- 36.1% net interest in block L27/43 - containing the undeveloped Dong Mun gas
field


--- 21.7% net interest in block L13/48 located adjacent to blocks L15/43 and
L27/43, contains Si That discovery


Additional information, including the Company's complete competent person's may
be found on the Company's website, www.CoastalEnergy.com or may be found in
documents filed on SEDAR, www.sedar.com.


This statement contains 'forward-looking statements' as defined by the
applicable securities legislation. Statements relating to current and future
drilling results, existence and recoverability of potential hydrocarbon
reserves, production amounts or revenues, forward capital expenditures,
operation costs, oil and gas price forecasts and similar matters are based on
current data and information and should be viewed as forward-looking statements.
Such statements are not guarantees of future results and are subject to risks
and uncertainties beyond Coastal Energy's control. Actual results may differ
substantially from the forward-looking statements.


(i) Per barrel of oil equivalent ("boe") amounts have been calculated using a
conversion rate of six thousand cubic feet of natural gas to one barrel of oil
equivalent (6:1). The term boe may be misleading, particularly if used in
isolation. A boe conversion ratio of 6mcf to 1bbl of oil is based upon an energy
equivalency conversion method primarily applicable at the burner tip and does
not represent a value equivalency at the wellhead.


These securities have not been registered under United States Securities Act of
1933 (the "US Securities Act") or the securities laws of any state and may not
be offered or sold in the United States or to US persons (as defined in
Regulation S under the US Securities Act) unless an exemption from registration
is available.