Eurogas Corporation News Release

CALGARY, ALBERTA--(CCNMatthews - May 18, 2007) - Eurogas Corporation ("Eurogas" or the "Corporation") (TSX VENTURE:EUG) today announced its financial results for the three months ended March 31, 2007. Eurogas' activities during the quarter concentrated on a technical front with the advancement of the Front End Engineering ("FEED") Study for the development of the Castor Underground Natural Gas Storage Project in Spain, as well as project financing with the signing of an Assistance Contract with Deutsche Bank. During the first three months of 2007, the Corporation invested $3.3 million in Spain and $502,036 in Tunisia. As at March 31, 2007, the Corporation had working capital of $13.6 million and an available $6 million line of credit, making it well positioned to continue the pre-construction phase of the Castor UGS Project and pre-development activities in Tunisia. As the Corporation is in the development stage, it incurred a net loss of $355,067 during the quarter.

Eurogas has filed its consolidated financial statements and related Management Discussion and Analysis for the period ended March 31, 2007 with Canadian securities regulatory authorities on the System for Electronic Document Analysis and Retrieval ("SEDAR").

The Corporation's Compensation Committee has approved the issue of 15,000 deferred share units to each member of the board of directors totalling 105,000 deferred share units.

In addition, the Committee approved the issue of share options in the amount of 200,000 to each director including Mr. Jonathan Goodman, Mr. R. James Kirker, Mr. Garth A.C. MacRae, Mr. Jay Poscente and Mr. M. Jaffar Khan, President and Chief Executive Officer. Mr. Derek H.L. Buntain and Mr. Ned Goodman, Chairman of the Board, were awarded 300,000 and 350,000 share options respectively. Mr. Harold P. Gordon and Ms. Joanne Ferstman, both directors of Eurogas' affiliates, were each awarded 500,000 Eurogas share options. All options awarded have a five-year term, vest over three years and were issued at an exercise price of $1.12 per share.

Jaffar Khan, President & CEO

Certain information set forth in this document, including management's assessment of the Corporation's future plans and operations, contains forward-looking statements. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond the Corporation's control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and ability to access sufficient capital from internal and external sources. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. The Corporation's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits the Corporation will derive from there. The Corporation disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.