December 11, 2009 (FinancialWire) — Strategic American Oil Corp. (OTCBB: SGCA), has identified a second potential waterflood target in the Illinois Basin.

The targeted land position is in a previously producing oil field that could host significant in-place reserves through Waterflood Recovery. By researching the Illinois State Geological Survey, the company has discovered the oil field previously produced an aggregate of approximately 1.8 million barrels of oil. Nearby waterflood operations in the same zones have yielded recovery rates of 80% of primary production.

Additionally, the company has been able to expand its 500-acre estimate for the initial Waterflood Target in Illinois to 1,325 acres. SGCA has currently leased a total of 550 acres of this previously producing field. company Chief Geologist, Jim Thomas, who has approximately 30 years of experience in the Illinois Basin, and a BS and MS from South Illinois University, is heading up the company’s Illinois operations and will review engineering and development plans with Barger Engineering, of Evansville, Indiana. Barger has engineered a number of waterflood projects in Illinois with a long history of success.

The Illinois Basin is a mature oil producing environment with a production history covering over 100 years. This development history has generated a large database including records for more than 180,000 wells. SGCA is working to grow its reserves and accessing and analyzing these historic records minimizes cost while identifying exploration and historical production targets to meet that growth. To date the company has leased over 2000 acres in Illinois through utilizing these records. Finding and leasing this waterflood project demonstrates the value of these historic records and the company’s expertise in managing those records.

“Waterflood” is an oil extraction method where water is pumped into an injection well displacing the reservoir formation and forcing the oil into a recovery well. This method is used to recover additional oil in place following primary production methods.

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