SOURCE: Lexaria Corporation

January 03, 2008 08:00 ET

Plans for 2008 Follow Oil Production Increase at End of 2007

VANCOUVER, BC--(Marketwire - January 3, 2008) - Lexaria Corp. (OTCBB: LXRA) (the "Company" or "Lexaria") announces an increase in oil and gas production and discusses plans for 2008.

PP F 52 BEGINS OIL PRODUCTION

Lexaria Corp. is pleased to announce that a third well in Mississippi has begun production of oil. The well, acquired in 2006 as part of the 12-well Phase I drill program, was earlier completed as a gas well and began producing gas in mid-October, 2007. Small amounts of oil production began two weeks later and by mid-December the well was producing an average of over 100 mcf/d of natural gas and an average of 55 barrels of oil per day.

This newly producing oil well, the PP -F52, is located some 12 miles from the Company's Belmont Lake oil field. At this time the Company cannot project the potential oil reserves or production from this well, which were assigned a valuation of zero in its most recent proved reserves report. Lexaria has a 30% gross working interest in this well and all other wells under the Phase I agreement.

SALT-WATER DISPOSAL WELL ALLOWS FOR INCREASED GAS PRODUCTION

In the greater Palmetto Point area, Lexaria notes that its operator has recently completed a salt-water disposal well, which is beginning to be used to dispose of excess water produced as a by-product of certain of its gas wells. This new salt-water disposal well will decrease operational costs and is expected to improve the operational productivity of several existing gas wells. Additional existing nearby gas wells will be connected to this disposal well as quickly as possible, thereby increasing field gas production.

CAPITAL PLAN FOR BELMONT LAKE OIL FIELD FOR 2008

Lexaria and its operator currently plan to drill a horizontal development well in mid-2008, to more fully exploit the Belmont Lake oil field. While precise details are not yet finalized, Lexaria expects this proposed new well to offer the possibility of a substantial increase in oil production and cash flow. Under the current planned scenario, this proposed horizontal well has the ability to have a material impact on the Company's operational performance in 2008.

The Company continues to analyze different exploration and development scenarios for 2008. However as a corporate goal, Lexaria expects to between double and triple its production by the end of December, 2008 based on expected cash flows from existing producing wells.

Lexaria notes that its current cash position combined with cash flow from operations is expected to be roughly sufficient to meet all current obligations and expenses throughout most or all of 2008, including the drilling of the above-mentioned horizontal development well.

Separately, Lexaria notes that a recent exploration well, the PP F-6A, was abandoned due to encountering only non-commercial quantities of gas.

Investors are invited to visit the Lexaria Corp.IR Hub at www.agoracom.com/IR/Lexaria where they can post questions and receive answers or review questions and answers already posted by other investors. Alternatively, investors are able to e-mail all questions and correspondence to LXRA@agoracom.com where they can also request to be added to the investor e-mail list to receive all future press releases and updates in real time.

About Lexaria Corp.

Lexaria Corp. is an oil & gas company active in Mississippi, Oklahoma and in Alberta, Canada. The main focus currently is Mississippi, where it holds between 30% and 50% gross interests in various gas and oil projects. Lexaria routinely evaluates additional oil & gas projects and corporate opportunities.

Statements which are not historical facts are forward-looking statements. The Company makes forward-looking public statements concerning its expected future operations, performance and other developments. Such forward-looking statements are estimates reflecting the Company's best judgment based upon current information and involve a number of risks and uncertainties, and there can be no assurance that other factors will not affect the accuracy of such forward-looking statements. It is impossible to identify all such factors but they include and are not limited to the existence of underground deposits of commercial quantities of oil and gas; cessation or delays in exploration because of mechanical, operating, financial or other problems; capital expenditures that are higher than anticipated; or exploration opportunities being fewer than currently anticipated. Such forward looking statements also include estimated cash flows and current and/or future rates of production of oil and natural gas, which can and will fluctuate for a variety of reasons; oil and gas reserve quantities produced by third parties; and intentions to participate in future exploration drilling. The Company may not have sufficient funding to thoroughly explore, drill or develop its properties. Access to capital, or lack thereof, is a major risk. Factors which could cause actual results to differ materially from those estimated by the Company include, but are not limited to, government regulation, managing and maintaining growth, the effect of adverse publicity, litigation, competition and other factors which may be identified from time to time in the Company's public announcements and filings.

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