FX Energy, Inc. says that drilling operations are underway on the Company's Kromolice North well in western Poland. The well is the second of four exploratory wells the Company expects to drill this year in Poland.

The Kromolice North well is intended to test an interpreted Rotliegend sandstone structure at a depth of 3,670 meters. It is located approximately 7 kilometers along trend from the Company's 2005 Sroda 4 discovery well. The Kromolice North well is in the Company's Fences concession. FX Energy owns a 49% interest in the well; the Polish Oil and Gas Company ("POGC") is the operator and owns 51%.

David Pierce, president of FX Energy commented, "We are pleased to be well underway and making good progress on our 2008 operations, especially as this year's budget and operations are almost double last year's. One element of our strategy is to increase reserves, production and revenue in our lowest risk area. The three wells scheduled for this year on our recently completed Sroda 3-D seismic (the Kromolice North, Sroda City and Kromolice South wells), collectively represent an important step forward with this strategy."

The Company reported that the Grundy well, also in the Fences concession, currently is drilling below 3,400 meters. The well is intended to test a possible Ca2/reef target at a depth of approximately 4,000 meters. In addition, the well is intended to test the Rotliegend sandstone below the Ca2/reef. Previously announced, the Grundy well started drilling in January. FX Energy owns a 49% interest; POGC operates and owns 51% interest in the well.

"The Grundy Ca2/reef well is significantly higher risk than our 3-D Rotliegend wells, but it is a key element in our strategy to search for significant reserves through high potential exploration. In addition to the Grundy well we are conducting seismic programs intended to identify high potential prospects in two of our 100% owned acreage blocks. This year's increased budget allows us to carry out exploration in several new areas while continuing to build momentum in our core area. This should be a very exciting year for the Company and its shareholders," said Mr. Pierce.

Tags: FX Energy