Admiral Bay to start drilling program

Admiral Bay Resources Inc. announces that the seven well drilling and test program at its Revloc project in the Appalachian Basin in Pennsylvania will begin next week. This drilling program was originally scheduled for December, but due to significant weather conditions through the month of December in Pennsylvania, the start of drilling has been delayed. The drilling locations have now been built for all seven wells and the rig is in the process of being moved to the first location. Three of the seven wells will be cored for testing, with casing to be run on all wells.

Operational Update At the Mound Valley project, the Company has begun its recompletion program in the Mulky and Summit shales. The first well completed, the Obrien 2-35, reached peak production within two months, exceeding 100 MCFGPD and then stabilizing at 80 – 100 MCFGPD. A second well, the Obrien 8-35 was completed with a similar frac and after only two weeks is producing at a rate of over 25 MCFGPD.

Two additional wells fraced have been placed back on line in the last week and are showing similar results as the Obrien 8-35. All three wells presently have high fluid levels. Production is expected to continue to increase as the fluid levels come down. A further 6 wells are being fraced this week in the project area and will be put back online shortly. As the results continue to come in, and if they remain consistent, the Company will attempt to recomplete all of the existing wells in the Mulky and Summit shales, adding to the existing zones that are open in each well.

At the Shiloh Project, the Company has recompleted a number of the wells in the Riverton Coal. With the indication of success at Mound Valley, the Company is now looking at recompleting some of the wells in the Mulky and Summit shales at this project as well. These shales are also present at the Company’s Santa Rita, Devon and Swordfish projects.