Index Oil and Gas, Inc. issued an update on its current and planned oil and gas operations.

Schroeder Gas Unit 1, drilled on the Habanero prospect, is a discovery in the Frio sandstone in Goliad County, Texas. First production started on 31 August at an initial rate of 300 mcfpd (thousand cubic feet per day) on a 7/64" choke. Index has a 37.5% Working Interest ("WI") and 28.125% Net Revenue Interest ("NRI") in the well and corresponding 80 acre gas unit.

Hawkins 1 is also a Frio sandstone discovery in Matagorda County, Texas. The well is awaiting hook-up to the local gas pipeline infrastructure. Excessive rainfall and dependence upon operator activity on adjacent acreage have delayed first production. These issues are being resolved. First production is expected during fourth quarter 2007 or sooner. Index has a 12.5% WI and 10.010634% NRI in the well and the corresponding 160 acre gas unit.

Ilse 1, drilled in search of high impact Middle Wilcox pay sands, reached a total depth of 17,000 feet and the drill rig was released on 4 April 2007. The well took longer to drill and test because of the use of a new rig, which experienced excessive down time for repairs, rainfall, and well control problems due to high pressure and carried into FY 2008. These issues resulted in a cost over-run to the original estimate. A Middle Wilcox zone was perforated between 16,760 feet and 16,784 feet, hydraulically fractured, and, on 5 June 2007, flow tested. The test failed to produce gas in commercial quantities. Potential gas zones up-hole are currently being evaluated by the participants for testing. Index has a 10% WI and an 8% WI after payout ("APO") of the prospect. Index has a 6% NRI APO.