DENVER, COLORADO, Thursday, September 12, 2002 – CREDO Petroleum Corporation (NASDAQ: CRED) today updated the status of its two core projects—natural gas drilling along the Anadarko Shelf of northwestern Oklahoma and application of its patented Calliope Gas Recovery System.

The company’s drilling program in 2002 centered on its 2,900-acre Sand Creek Prospect and its 2,300-acre Two Springs Prospect, both located in Harper and Ellis Counties, Oklahoma. Drilling targets the Morrow and Chester sands from 7,400 to 7,600 feet.

To date, five wells have been drilled and completed on the prospects. Two new wells are scheduled to commence in September and additional wells are anticipated on both prospects. CREDO owns interests ranging from 29% to 40% in the seven wells.

Of the five completed wells, three are producing and two are awaiting pipeline connection. The previously announced Glendena #1, Redfearn #1 and Wills #1 wells are currently producing at a combined daily rate of 5.25 MMcfg (million cubic feet of gas) with minimal water and condensate. The Glendena and Redfearn wells contain exceptional reservoir quality for the area and are delivering gas at higher than normal rates.

Production from the previously announced Easterwood #1 and Weiszbrod #1 wells has been delayed approximately three months during broad-scale negotiations with pipeline companies to move additional gas out of the area. "Our drilling in the area has created pipeline capacity problems which required expansion considerations and protracted negotiations," said James T. Huffman, President. "The negotiations have been finalized and pipelines to the wells are expected to be completed in the next few weeks. The pipeline delay caused us to miss our third-quarter goal of increasing production by 100% compared to the 74% actually achieved."

The Easterwood #1 well has not been perforated or tested pending pipeline connection. CREDO owns a 40% interest in the well and is the operator. The well is expected to be connected to the pipeline in the next two weeks and will be immediately completed for production.

The Weiszbrod #1 well, previous reported as a "tight hole", encountered two Morrow sands totaling 17 feet. After fracture stimulation, the well was tested flowing 1.3 MMcfg per day. CREDO owns 33% of the well which is the fourth consecutive successful well on the Sand Creek Prospect. It is also expected to be connected to the pipeline in the next two weeks.

During September, the Hudson #1 well will be drilled on the Sand Creek Prospect approximately one mile north of the Weiszbrod well and the Emet #1 well will be drilled on the Two Springs Prospect approximately one mile east of the Wills well. Both wells will test the Morrow and Chester sands from 7,400 to 7,600 feet. CREDO owns 35% of the Emet well and 40% of the Hudson well and will be the operator of both wells.

"We are extremely pleased with our drilling success in northwest Oklahoma," Huffman said. "A number of additional wells are likely to be drilled as we delineate our Sand Creek and Two Springs Prospects. In addition, we have a number of other properties and drilling prospects in northwest Oklahoma and we are constantly generating new drilling prospects in the area. Our goal is to maintain our momentum by continuing to build on our knowledge and success in the area."

As previously reported, CREDO owns the exclusive right to a patented technology known as the Calliope Gas Recovery System. Calliope can achieve substantially lower flowing bottom hole pressure than conventional production methods because it does not rely on reservoir pressure to lift liquids. In many gas wells, lower bottom hole pressure translates into recovery of substantial additional gas reserves.

CREDO's field applications have proven Calliope to be low risk, cost effective and repeatable over a wide range of depths (down to 18,600 feet) and applications, including the most rigorous scenario of completely dead wells. Excluding prototype applications, Calliope is currently installed on five company-owned wells, four of which were dead and scheduled to be plugged and abandoned. Combined daily production for those wells has ranged between 1.1 and 1.3 MMcfg and their remaining economic lives are estimated to range from seven to 20 years. Calliope wells have had a major positive impact on CREDO’s production and reserves.

The company expects to install two new Calliope systems in the next few months. The 18,400-foot Green Estate #1 well located in Beckham County, Oklahoma produced 28.8 Bcfg and has been dead for over a year. This well will provide a rigorous test for Calliope in terms of both extreme depth and the challenge of reviving a dead well. A second well, the Horn #1, produced 12.9 Bcfg and has also been dead for over a year. This 12,400-foot well is located in Grady County, Oklahoma. CREDO will own approximately 70% of both wells and will be the operator. A third Calliope well has recently been purchased and negotiations are in progress on several additional wells.

"Stronger natural gas prices have made it more difficult to purchase viable wells for application of our Calliope system," Huffman said. "This has made it necessary for us to consider other strategies to install Calliope systems on more wells. These strategies include joint venturing with larger companies that own wells considered to be Calliope candidates, licensing, or providing Calliope for a fee. To implement these strategies, CREDO is preparing a highly sophisticated multimedia presentation about Calliope."

"Production of the multimedia project was significantly delayed because, after starting the project, we decided to change production companies," Huffman said. "Despite the false start, we are very pleased with the project. Sophisticated animation of Calliope’s underground operations is the most complex part of the project, and that work is nearing completion. We expect the entire presentation to be completed in four to eight weeks."

"We have proven that Calliope will add .5 billion to 2.0 billion cubic feet of gas reserves to many dead and uneconomic wells," Huffman said. "Our goal is to install Calliope on more wells, and a first class marketing presentation is expected to help us get that ball rolling."

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CREDO Petroleum Corporation is a publicly traded independent energy company headquartered in Denver, Colorado. The company is engaged in the exploration for and the acquisition, development and marketing of natural gas and crude oil in the Mid-Continent and Rocky Mountain regions. The company's stock is traded on the NASDAQ System under the symbol "CRED" and is quoted daily in the "NASDAQ Small-Cap Issues" section of The Wall Street Journal.