February 14, 2005
TSX-V:LEY

NEWS RELEASE

Fracture Stimulation of D-14 Appraisal Well – Extended Production Test to Commence

Calgary, Alberta, CANADA, February 14, 2005 – Loon Energy Inc. (“Loon”) (TSX-V-LEY) is pleased to announce that the Dolina-14 (D-14) appraisal well in northeastern Slovenia has been successfully fracture stimulated. The well has been completed with a temporary connection to the local distribution network and an extended production test will commence shortly. The production test will be designed to assess reservoir flow properties, well drainage radius and ascertain long term gas well deliverability. Data gathered will be used to evaluate and design future drilling and development activities.

Three fracture stimulations on D-14 were undertaken by Schlumberger with approximately 165 tonnes of carbolite proppant and 640 cubic metres of fluids used to create high conductivity paths in the formation. Post fracture evaluation indicates that the stimulation was effective. D-14 has been completed with 2 3/8” tubing and connected to a temporary well test separator and the local gas distribution network allowing for an extended production test over the coming months. During the initial fracture stimulation of the lower interval, reservoir overpressure and high fracture gradients were encountered and overcome. A further announcement will be made in relation to well productivity in approximately four weeks. Loon has a 10.50% carried working interest in the well.

Loon is focused on international exploration and development projects in Slovenia, other areas of Europe and parts of South America.

Some of the statements contained in this release are forward-looking statements. Forward-looking statements may include, but are not limited to, statements concerning estimates of recoverable hydrocarbons, expected hydrocarbon prices, expected costs, statements relating to the continued advancement of the Company’s projects and other statements which are not historical facts. When used in this document, and in other published information of the Company, the words such as “could,” “estimate,” “expect,” “intend,” “may,” “potential,” “should,” and similar expressions are indicative of a forward-looking statement. Although the Company believes that its expectations reflected in the forward-looking statements are reasonable, the potential results suggested by such statements involve risk and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Various factors, which could cause actual results to differ from these forward-looking statements, include the potential that the Company’s projects will experience technical and mechanical problems, geological conditions in the reservoir which may negatively impact levels of oil and gas production and changes in product prices and other risks not anticipated by the Company or disclosed in the Company’s published material. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties.

The TSX Venture Exchange neither approves nor disapproves of the information contained herein.