Lynden Ventures Ltd.
TSX VENTURE : LVL

Lynden Ventures Ltd.

June 06, 2007 09:00 ET

Lynden Ventures Ltd.: $14.4 Million Financing, Acquisition of Paradox Basin Southern Prospect Area

VANCOUVER, BRITISH COLUMBIA--(Marketwire - June 6, 2007) -

NOT FOR DISSEMINATION INTO THE UNITED STATES OF AMERICA OR DISTRIBUTION TO U.S. NEWSWIRE SERVICES

Lynden Ventures Ltd. (TSX VENTURE:LVL) reports that it is undertaking a non-brokered private placement in the amount of $14,400,000. These funds will be raised by the company issuing a total of 18,000,000 units at a price of $0.80 per unit. Each unit is comprised of one common share and one half of a share purchase warrant. Each whole warrant will entitle the holder to purchase one additional common share at a price of $1.25 for two years.

The funds raised from this private placement will be principally used to fund the acquisition of a 25% working interest in the Southern Prospect Area and to fund operations on the Southern and Northern Prospect Areas of the Paradox Basin Project, Utah.

Fees and commissions will be payable in connection with the private placement. The private placement is subject to the approval of the TSX Venture Exchange.

Acquisition of Southern Prospect Area

Lynden has entered into a non-binding letter of intent with a company associated with the operator of the Paradox Basin Project to acquire a 25% before payout working interest (23.75% after payout working interest) in a prospect area south and contiguous (the "Southern Prospect Area") to Lynden's current Paradox Basin Project 900,000 acre prospect area (the "Northern Prospect Area"). The Southern Prospect area of mutual interest covers 625,000 acres and currently includes leases covering approximately 16,000 acres. Included in the acquisition are three recently re-entered wells where the operator successfully performed completions similar to those carried out in the Northern Prospect Area. Numerous zones were completed in all three wells and significant gas was flared from the productive zones. The operator is in the process of permitting and planning a gas gathering system to tie the wells into production, although one of the three wells encountered operational problems which may not allow the zones completed to date in that well to be produced. Also included in the Southern Prospect Area, are numerous re-enterable wellbores with modern logs.

Management believes that the proposed acquisition is a significant step in the growth of the company and it is anticipated that it will result in the company receiving its first gas sales from the Paradox Basin Project prior to the Fall of 2007. Similar to the Northern Prospect Area, the operator is targeting 1 to 5 Bcfe per well in the Southern Prospect Area.

Under the terms of the letter of intent, the company can acquire the 25% working interest by paying USD $5,000,000. The effective date of the acquisition will be April 1, 2007. It is a condition of the acquisition that the company raise sufficient capital to acquire the 25% working interest and to fund near term operations on both the Northern and Southern Prospect Areas. The acquisition is also subject to the negotiation and execution of a binding agreement, and approval of the TSX Venture Exchange.

Northern Prospect Area

Lynden has a 55% before payout working interest (41.25% after payout working interest) in an 80% net revenue interest in the 900,000 acre Paradox Basin Project Northern Prospect Area. The Northern Prospect Area lease holdings presently cover in excess of 110,000 acres.

Significant operations on the Northern Prospect Area are the re-entry and initial testing of the first well (March to June 2006) and the re-entry and initial testing of a second well (July 2006 to February 2007). Both re-entry wells are currently shut-in gas wells waiting for connection to sales.

About the Paradox Basin Project

Upon completion of the acquisition of the Southern Prospect Area, the Paradox Basin Project will cover two contiguous oil and gas prospect areas covering in excess of 1,525,000 acres established by Lynden, its working interest partners, and the project operator, a middle tier Texas-based oil and gas company with substantial experience in the area.

The Paradox Basin Project lease holdings will cover in excess of 126,000 acres. The operator is targeting gas production from shales and other Paradox Basin lithologies. The operator's exploitation program is based on commingling production from multiple zones, which has been successfully done by other operators in the Paradox Basin. The operator is targeting 1 to 5 Bcfe per well.

The operator is preparing a multi-well program and an associated gathering system to explore and develop the Paradox Basin Project over the next 12 to 15 months.

Corporate Matters

In addition, the company has granted 1,560,000 incentive stock options to certain of its directors, officers, employees and consultants. The stock options are exercisable at a price of $1.00 per common share for a period of five years.

ON BEHALF OF THE BOARD OF DIRECTORS

LYNDEN VENTURES LTD.

Colin Watt, President and CEO

WARNING: This news release contains forward-looking information, including but not limited to the company's intention to undertake a private placement and acquire a 25% before payout working interest in the Southern Prospect Area, and the belief that a multi-well program and an associated gathering system to explore and develop the Paradox Basin Project over the next 12 to 15 months will be carried out. The reader is cautioned that assumptions used in the preparation of such information, although considered accurate at the time of preparation, may prove incorrect. The actual results may vary materially from the information provided herein. Consequently, there is no representation by the company that actual results achieved will be the same as those forecast.

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

Contact Information

  • Lynden Ventures Ltd.
    Colin Watt
    President and CEO
    (604) 629-2991
    (604) 602-9311 (FAX)