Continental Energy Corporation Announces Drilling Rig Underway to Bengara-II Block

DALLAS, Feb. 22, 2007 (PRIME NEWSWIRE) -- Continental Energy Corporation (OTCBB:CPPXF) today announced that the drilling rig contracted to drill in the Bengara-II Block has been mobilized and is underway from Jakarta to the NE Kalimantan drill site.

Indonesian drilling contractor PT Indo Sichuan Petroleum, who was awarded the turnkey drilling contract (See the Company's 18 January 2007 press release), has dispatched a land drilling rig for the job.

The rig is rated to drill to a depth of over 4,000 meters and is a new unit fabricated to API specifications near Chengdu, Sichuan Province, China by CNPC Sichuan Petroleum the parent company of contractor PT Indo Sichuan Petroleum. The rig arrived by sea in Tanjung Priok port of Jakarta from Shanghai last month where it was inspected and cleared through customs. Since then it has been prepared and accumulated with other related materials and equipment for the Bengara-II 2007 drilling campaign.

The rig and related equipment has now departed Jakarta's Tanjung Priok port and is at sea aboard barges bound for a remote jungle landing site in the Bengara-II Block near the drillsites. The marine transit time from Jakarta to the landing site is expected to take 7 to 10 days depending upon prevailing weather and sea conditions. The rig is expected to arrive in the Bengara-II Block in the first week of March.

In the meantime site preparation and earth works have commenced at both the Bengara-II Block marine rig landing site and also on the Seberaba-#1 drill site, the first of 4 exploration well drill sites planned for 2007. Upon completion of landing the rig and accumulating related equipment at the marine landing site the rig will be transported overland to the Seberaba-#1 site. Deployment of the rig from the marine landing site to the Seberaba-#1 is expected to take 3 to 4 weeks depending upon weather conditions.

Continental anticipates an early April spud of the long awaited Seberaba-#1 exploration well. Drilling of the 4,200 meter deep Seberaba-#1 is expected to take up to 70 days at a cost of over and 6,000,000.

On behalf of Continental Energy Corporation

 "James D. Eger"
 Secretary and CFO

About Continental Energy Corporation: Continental Energy Corporation is an independent oil and gas exploration company, focused entirely on making a major oil or gas discovery in Indonesia.

No securities regulatory authority has either approved or disapproved the contents of this news release.

Certain matters discussed within this press release may be forward-looking statements within the meaning of the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. Although Continental believes the expectations reflected in such forward-looking statements including reserves estimates, production forecasts, feasibility reports and economic evaluations are based on reasonable expectations and assumptions, it can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from expectations include financial performance, oil and gas prices, drilling program results, regulatory changes, political risk, terrorism, changes in local or national economic conditions and other risks detailed from time to time in Continental's periodic filings with the U.S. Securities Exchange Commission.

CONTACT:  Continental Energy Corporation
          Jim Eger

          Suite 1200, 14001 Dallas Parkway
          Dallas, Texas 75240