Admiral Bay Resources Inc.
TSX VENTURE : ADB

Admiral Bay Resources Inc.

March 25, 2010 16:26 ET

Admiral Bay Resources Updates Strategic Review Process

CENTENNIAL, COLORADO--(Marketwire - March 25, 2010) - Admiral Bay Resources Inc. (TSX VENTURE:ADB)  Admiral Bay Resources Inc. ("Admiral Bay" or the "Company") today provided an update on its strategic review process announced in October of 2009.

As a result of the review process, the Company is currently in discussions with a third party regarding a possible strategic combination. While discussions are ongoing there is no guarantee that such talks will result in an agreement between the parties. In addition, as a result of sustained, low realized natural gas prices, the Company believes that consideration paid for any combination is likely to be below the current enterprise value of the Company. Any transaction would be subject to approval by shareholders as required under British Columbia corporate and securities laws and consent of the Company's lenders.

Should the Company not reach an agreement for a strategic combination, the Company's current lenders may choose to exercise their right to foreclose on certain assets of the Company that were pledged as security under the current credit facility. As a result, the Company is discussing potential options to restructure its debt with current lenders. The outcome of such discussion is uncertain. Should the Company not reach an amicable agreement with its current lenders, the lenders may choose to initiate foreclosure proceedings.

From February 2009 to November 2009, the Company entered into five amendments to the credit facility that have allowed the Company to capitalize certain interest amounts. Such capitalized interest is added to the loan balance. Those amendments allowed the Company to pay a minimum of 5% cash interest and capitalize 10% interest on a monthly basis. The current amendment allowing the capitalization of interest was extended through January 2010 and included an extension on the maturity of the Neodesha Loan for approximately $1.8 million through January 2010. The lenders did not provide additional extensions.

In anticipation of the possibility of foreclosure action by Admiral Bay's lenders, the Company has retained counsel to review possible responses to any action which range from continued negotiations to more formal, court-supervised reorganization of the Company and its subsidiaries.

The Company will provide additional information as appropriate.

About Admiral Bay Resources

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".

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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