Doral Energy Corp.
OTC Bulletin Board : DRLY

Doral Energy Corp.

October 23, 2009 13:28 ET

Doral Energy Corp. Announces Eddy County, New Mexico Acquisition

MIDLAND, TEXAS--(Marketwire - Oct. 23, 2009) - Doral Energy Corp. (OTCBB:DRLY) ("Doral" or "the Company") announced today that it has signed a letter of intent ("LOI") with Blugrass Energy, Inc. ("Blugrass") to acquire a 40.0% working interest ("WI") in all leases owned by Blugrass in and around the Cave Pool Unit located in Eddy County, New Mexico (the "Cave Pool Unit"). Blugrass had previously acquired a 100% working interest in the approximately 2,800 acres of the Cave Pool Unit properties from Robinhood L.L.C. (Marks and Garner Production Company) on October 12, 2009. Closing of this acquisition is planned for next week with an effective date of October 12, 2009. Doral Energy Corp. will be the Operator of the Cave Pool Unit properties. The acquisition will bring Doral Energy's leasehold position in Eddy County, NM to approximately 10,600 gross acres (8,920 net acres).

The Cave Pool Unit properties are located adjacent to 3 leases owned and operated by Doral which produce from the Grayburg and San Andres formations and contain 9 proved undeveloped ("PUD") drilling locations in the Square Lake Field. The Cave Pool Unit properties currently produce approximately 12 BOPD and 30 MCFD of natural gas from 32 wells which were drilled on 40-acre well spacing in the Grayburg formation of the Grayburg Jackson Pool. An additional 10 shut-in wells on the properties have been identified and will be reworked and returned to production by Doral Energy after closing of the acquisition, adding to the daily production from the properties. The redevelopment of the Cave Pool Unit as a 20-acre 5-spot Grayburg waterflood project could potentially add approximately 100 development drilling locations and potential gross reserves in excess of 3.0 million barrels of oil equivalent.

H. Patrick Seale, President and Chief Operating Officer of Doral, states, "Doral Energy is very excited to have the opportunity to develop the Cave Pool Unit properties with our new partner, Blugrass Energy. These properties fit well within our existing properties and will allow Doral to operate the Cave Pool Unit very economically utilizing our field personnel and economies of scale when added to our existing 186 wells and approximately 7,800 acres in Eddy County, NM along the Artesia-Vacuum Trend. The redevelopment of the Cave Pool Unit has the potential of being very beneficial to both Doral Energy and Blugrass Energy."

About Doral Energy Corp.

Doral Energy Corp. (OTCBB:DRLY) is an oil and gas exploitation and production company headquartered in Midland, Texas. Doral Energy Corp.'s strategy is to grow a portfolio of under-developed production and exploitation assets with the potential for generating near-term increases in existing production through operational improvements, and longer-term development of proved undeveloped reserves by infill drilling. Doral focuses on identifying acquisitions that generate immediate cash flow from production, but which also have strong proved developed non-producing and proved undeveloped reserves that can be tapped for significant growth. The prolific Permian Basin of Texas and New Mexico is the geographic region of focus for the Company's future acquisition activity. Doral's first producing assets, the Hanson Properties in Eddy County, New Mexico, located in the northwestern Permian Basin of New Mexico, are currently producing 135 BOEPD.

Further Information

Shareholders and investors are encouraged to visit Doral Energy's website at for more information.


Everett Willard ("Will") Gray, II, Chief Executive Officer

Forward Looking Statements

This news release contains forward-looking statements that are not historical facts and are subject to risks and uncertainties. Forward-looking statements are based on current facts and analyses and other information that are based on forecasts of future results, estimates of amounts not yet determined, and assumptions of management. Forward looking statements are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "aims", "potential", "goal", "objective", "prospective", and similar expressions or that events or conditions "will", "would", "may", "can", "could" or "should" occur. Information concerning oil or natural gas reserve estimates may also be deemed to be forward looking statements, as it constitutes a prediction of what might be found to be present when and if a project is actually developed. In particular, there is no assurance that Doral will be able to re-finance its current credit facility or acquire any future properties.

Actual results may differ materially from those currently anticipated due to a number of factors beyond the reasonable control of the Company. It is important to note that actual outcomes and the Company's actual results could differ materially from those in such forward-looking statements. Factors that could cause actual results to differ materially include misinterpretation of data, inaccurate estimates of oil and natural gas reserves, the uncertainty of the requirements demanded by environmental agencies, the Company's ability to raise financing for operations, breach by parties with whom the Company has contracted, inability to maintain qualified employees or consultants because of compensation or other issues, competition for equipment, inability to obtain drilling permits, potential delays or obstacles in drilling operations and interpreting data, the likelihood that no commercial quantities of oil or gas are found or recoverable, and our ability to participate in the exploration of, and successful completion of development programs on all aforementioned prospects and leases. Additional information on risks for the Company can be found in the Company's filings with the US Securities and Exchange Commission.

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