December 4, 2003

News Release: San Telmo Energy Ltd. production and exploration update

San Telmo Energy Ltd. (OTCBB: STUOF; TSX-VEN: STU) is pleased to announce an update on current operations.

Gordondale and McLeod

San Telmo has successfully completed and tested its Gordondale well. Public consultation and surveying is currently being conducted, and facilities construction is expected to begin in December.

San Telmo has successfully completed and tested its McLeod well at a maximum unstimulated rate of 6.5 mmcfd and 325 bbls of condensate per day. Sufficient third party pipeline and gas plant capacity has been acquired. Surveying of a six inch gas pipeline has been completed and construction is expected to begin shortly. Gordondale and McLeod are currently on schedule to be tied-in for production by the new year, providing significant cash flow for San Telmo to fund ongoing exploration and additional production opportunities in the future.

Peace River Arch (Teepee Creek)

After encouraging results, San Telmo has increased its working interest in the Peace River Arch (Teepee Creek) site from 50% to 100%. San Telmo is currently surveying and applying for a license for a second well in the development of its Peace River Arch (Teepee Creek) prospect. San Telmo expects the well to be drilled and evaluated in the current quarter, which ends January 31, 2004.

ABOUT SAN TELMO ENERGY LTD.

San Telmo Energy Ltd. is an emerging oil and gas company with an experienced management team. Operated through its wholly owned subsidiary San Telmo Energy Inc. of Calgary, Alberta, San Telmo Energy Ltd. is focused on acquiring, developing and producing proven developed and underdeveloped reserves which offer long term value for the company.

FORWARD-LOOKING STATEMENT

This release may contain forward-looking statements, within the meaning of the 'safe-harbour'provision of the Private Securities Litigation Reform Act of 1995, regarding San Telmo Energy's business or financial condition. Actual results could differ materially from those described in this news release as a result of numerous factors, some of which are outside of the control of the company.


SOURCE San Telmo Energy Ltd.

Corporate Communications, (877) 772-9286, This email address is being protected from spambots. You need JavaScript enabled to view it., or the company website at www.santelmoenergy.com

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