September 27, 2004
ON Energy Rights Offering and Onshore Drilling Program Update

Toronto, Ontario - CGX Energy Inc. (OYL.U - TSX-V) and its subsidiary ON Energy Inc. are pleased to report the results of the ON Energy Annual General Meeting held on September 23, 2026 in Georgetown, Guyana.

At the annual meeting, ON Energy announced a rights offering for its shareholders. The terms of the Rights Offering are that each shareholder shall be given two rights for each ON share held, each right entitling the shareholder to purchase one ON common share for US$ 0.06 per share. 141,800,000 rights will be issued for a total offering of US$8.5 million. Guyana Americas Merchant Bank Inc. of Georgetown, Guyana has agreed to underwrite 63.8 million shares of the Rights Offering for US$3,828,600. CGX Energy will participate in the Rights Offering. If all the rights are exercised, CGX will hold approximately 57% of ON Energy.

The funds raised from this Rights Offering will be used primarily to fund exploration activities within the Berbice Block, including the upcoming drilling program recently announced by ON Energy and for general working capital purposes.

Management of ON Energy also reported that preparations for the drilling program are proceeding on the defined drill targets. On shore logistics are on schedule, including warehousing, road building and drill pad preparation. ON Energy has agreements for drilling and other services in place subject to finalizing contracts. Drilling supplies, mud and other items including casings have been purchased and are scheduled to leave from Louisiana, USA by barge through the Gulf of Mexico. The shipment of these supplies has not received clearance due to the stream of recent hurricanes in this region and as a result the shipments have been delayed.

Kerry Sully, President of CGX and Chairman of ON Energy stated "We are pleased to have condensed into one year all of our preliminary exploration, successfully scheduling our operations into Guyana 's dry season. By fast-tracking our operation, we had hoped to start drilling in the fourth quarter of 2004, but unfortunately hurricanes in the Gulf of Mexico and the Caribbean have delayed drilling until January 2005."

Warren Workman, Vice-President of CGX and President of ON Energy added "Our new seismic has supplemented 8 prospects that had been identified as leads with our geochemical program. Further, an enhanced geochemical analysis on recently acquired samples suggests a likelihood of lighter oil. We are encouraged that closing this rights issue should allow us to expand our drilling program to test additional targets."

CGX Energy is a Canadian-based oil and gas exploration company focused on the exploration for oil in the Guyana.  CGX is managed by a team of experienced oil and gas and finance professionals from Canada, U.S.A. and the UK. CGX is financed internationally and has thousands of shareholders worldwide.  For further information please contact: Kerry Sully, President & CEO at (604) 733-9647, Charlotte May, Investor Relations at (416) 364-3353 or Denis Clement, Director at (416) 364-1909 or visit our website at www.cgxenergy.com.

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THIS PRESS RELEASE WAS PREPARED BY CGX ENERGY INC., WHICH ACCEPTS THE RESPONSIBILITY AS TO ITS ACCURACY. THE TSX VENTURE EXCHANGE DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

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THIS PRESS RELEASE WAS PREPARED BY CGX ENERGY INC., WHICH ACCEPTS THE RESPONSIBILITY AS TO ITS ACCURACY. THE TSX VENTURE EXCHANGE DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.