Admiral Bay Resources Inc.
TSX VENTURE : ADB

Admiral Bay Resources Inc.

January 10, 2007 14:49 ET

Admiral Bay Engages RBC Capital Markets as Financial Advisor to Evaluate Stategic Alternatives

- Macquarie increases borrowing base on line of credit

CENTENNIAL, COLORADO--(CCNMatthews - Jan. 10, 2007) - Admiral Bay Resources Inc. (TSX VENTURE:ADB) announces that its board of directors is exploring strategic alternatives to increase shareholder value. The Company has formed a Special Committee of the Board of Directors, retained legal counsel and engaged RBC Capital Markets as its financial advisor to assist in the strategic alternatives process. RBC Capital Markets will assist the Company in identifying and analyzing various alternatives, including the expression of interest for acquisition of the Company previously announced (see news release of December 15, 2006).

The Company also stated that it does not expect to disclose developments with respect to the exploration of strategic alternatives unless and until its Board of Directors (and the special committee thereof) has approved a definitive transaction or strategic option. There can be no assurance that any transaction will occur or, if a transaction is undertaken, its terms or timing.

The Company also wishes to announce that the Macquarie Bank has increased the borrowing base on the Company's revolving line of credit by US$3.4 mil, to US$18.4 mil. These new funds will be used to connect wells drilled under the 2006 Development Plan to the pipeline and bring new production online. The Company currently has an inventory of over 60 wells awaiting connection to the pipeline at its Shiloh and Mound Valley projects. In addition, equipment that the Company has been awaiting installation at its Mound Valley project will be operational by the end of the week and will enable the Company to connect new wells to the pipeline at the project.

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".

The TSX Venture Exchange does not accept responsibility for the adequacy of this release.

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