June 3, 2003

News Release: To Commence Drilling of High-Impact Nisku Prospect

San Telmo Energy announced it will commence drilling of its high-impact Nisku prospect later this week. The prospect, which is located in Albertas prolific West Pembina area, is a Nisku Pinnacle Reef identified through proprietary seismic data. As the operator, San Telmo will test the Nisku formation to a target depth of 3,025 meters (10,000 feet).

San Telmo is also scheduling to drill its Gordondale prospect during the current quarter. The site, held 100% by San Telmo, is currently being surveyed in preparation for drilling. The immediate area hosts a number of multi-zone producing wells. A pool similar to San Telmo's Gordondale target has to date produced 140,000 barrels of oil and 1 billion cubic feet of gas from two wells. 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. The company has 10,017,225 shares issued and outstanding and is publicly traded under the symbol 'STUOF'.

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 Resources 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.

Media Contact:

CONTACT: TEL: 877-772-9286 Christine Payne

Email:This email address is being protected from spambots. You need JavaScript enabled to view it.

Investor Relations Contact:

TEL: 877-772-9286 Nick Boutsalis

Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

WEBSITE This email address is being protected from spambots. You need JavaScript enabled to view it.