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ADB Admiral Bay Resources Inc.

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Share Name Share Symbol Market Type
Admiral Bay Resources Inc. TSXV:ADB TSX Venture Common Stock
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.00% 0 -

Admiral Bay Reports Signing $5.75 Million Farmout Deal in Kansas

01/07/2009 6:14pm

Marketwired Canada


Admiral Bay Resources Inc. (TSX VENTURE:ADB) ("Admiral Bay" or the "Company") is
pleased to report it has signed a farmout agreement with Euramerica Energy Inc.
of Brescia, Italy to drill 25 wells in 2009 and 25 wells in 2010 in the Thayer
and Mound Valley projects for a total commitment of $5.75 million. Euramerica
will pay all the costs of drilling and completing the wells for a turnkey fee.
Upon connection to the pipeline, the Company will retain a 20% working interest
and be operator and Euramerica will earn an 80% working interest in each well.
Euramerica earns only the wellbore and associated spaced land for each well it
funds. Assuming average gross gas reserves of 150 mmcf per well as based on the
Company's 2008 reserve report, the 20% carried interest would add 1.5 bcf to
Admiral Bay's proved producing reserves for the wells drilled under the farmout.
In addition, up to 50 proved undeveloped locations could be added to Admiral
Bay's reserve base or up to 7.5 bcf depending on the locations agreed upon, all
at no cost to the Company. The Company expects drilling to commence within 60
days once Euramerica has completed its funding. The location of the wells is to
be determined by the Company and Euramerica. 


President and CEO Steven Tedesco commented "This deal allows us, on a carried
basis, to grow production and continue to prove up additional reserves in this
difficult financial environment without incurring additional debt. This deal
along with our recently announced acquisition of the Thayer project show our
commitment to growth during this down cycle in the natural gas business so that
we are well positioned when the price environment turns in the future. The level
of commitment by Euramerica shows the quality of our asset base and we look
forward to working with them to increase production, cashflow and proved
reserves." 


Admiral Bay Resources Inc. (www.admiralbay.com) is an emerging unconventional
gas production company focused on the development of projects in the Cherokee
Basin in southeast Kansas and the Appalachian Basin in Pennsylvania. Admiral Bay
is listed on the TSX Venture Exchange under the symbol ADB.


Statements in this release that are not historical facts are "forward-looking
statements" within the meaning of the U.S. Private Securities Litigation Reform
Act of 1995. Readers are cautioned that any such statements are not guarantees
of future performance and that actual developments or results may vary
materially from those in these "forward-looking statements".


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