| ||March 15, 2006|
MBA Completes The Acquisition Of The Gordon Creek, Utah Natural Gas Field
| ||March 15, 2006, (Vancouver, British Columbia) MBA Resources Corp. (TSX-V: MBA) announced today that it has closed the previously announced acquisition of a 50% interest in the Gordon Creek producing gas field located in Carbon County, Utah. (See news releases dated March 7 and March 9, 2006) The Project was jointly acquired with Fellows Energy Ltd. of Broomfield, Colorado. |
The field comprises 5,953 gross acres (4,879 net acres) with three gas wells currently producing approximately 20 million cubic feet of natural gas per month from the Ferron Sandstones, as well as five shut in wells, 3 of which have previously produced. Gas is marketed into a transmission pipeline operated by Questar Gas Resources that crosses the project acreage. The acquisition also includes an associated gas gathering system consisting of 6 miles of pipeline and a scaleable compression facility that services the project as well as adjacent production.
The Gordon Creek project is an extension of the very successful Drunkards Wash field originally developed by River Gas Corp. and presently operated by Conoco/Phillips. Drunkards Wash currently produces approximately 4Bcf of natural gas per month from wells completed in both the Ferron Sandstone and Ferron coals over a project area of approximately 65,000 acres. Steven Prince, who will head the MBA-Fellows Gordon Creek Joint Venture, previously served as Operations Manager on the Drunkards Wash Project for River Gas and was involved in drilling, completion and production operations for over 200 wells in the field.
In the fall of 2005, Fellows commissioned Sproule Associates of Denver to review the project in order to assess the viability of increasing production from the existing producing and shut in wells, as well as drilling additional wells on the acreage. Based on a very favourable review by Sproule and following internal analysis by both MBA and Fellows, it is believed that production from the existing wells can be significantly increased and that there are many additional drill targets that have the potential to produce gas from the Ferron formation (sandstone and coals) in excess of the production rates currently experienced in the existing wells.
MBA and Fellows are finalizing plans to immediately initiate reworking operations on 2 of the wells -- one producing and one shut in well -- at a preliminary cost estimate of US$215,000. A complete review of the available data for the remaining 6 wells is ongoing. MBA and Fellows also plan to drill up to 20 additional wells on the acreage, targeting the Ferron Sandstones and coals. The coal seams that have been prolific producers at Drunkards Wash have not yet been exploited in the Gordon's Creek Project.
"The Gordon Creek project is an ideal acquisition for our company at this stage," stated Cameron White, President of MBA. "It provides us with immediate, stable production and cash flow, as well as offering tremendous upside potential with a reasonable risk profile. The infrastructure in place is first class and will be easily scaleable if we are successful in our efforts to substantially increase production. Equally importantly, we are very confident in the ability of Steven Prince and his crew to extract the maximum potential from the project."
MBA also wishes to report that it has closed the $1,850,000 convertible debenture financing announced March 9, 2006. Hold periods applicable to any common shares issued upon conversion of the convertible debentures and any shares issued upon the exercise of warrants will expire July 14, 2006.
For more information, contact Mr. Cam White at 604-707-0373.
The TSX Venture Exchange has not reviewed and does not accept responsibility for the accuracy or the adequacy of this press release.
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