BPI Industries Inc.
TSX VENTURE : BPR

BPI Industries Inc.

June 27, 2005 10:49 ET

BPI Brings 3rd Rig to Accelerate Drilling Program

SOLON, OHIO--(CCNMatthews - June 27, 2005) - BPI Industries Inc. (TSX VENTURE:BPR) announced today that it in an effort to accelerate its drilling program, it has contracted for a 3rd drilling rig for its Delta Project and that rig has moved on site. The Company expects to be drilling new wells at a minimum rate of three wells per month per rig.

To date, there have been 32 wells drilled and completed and 26 are in production in the current development program at the Delta Project. Further, 17 additional wells, including 7 abandoned mine works wells, will be incorporated in the development program as development is expanded in those areas. The production reported to date has been from 18 wells producing during the dewatering phase, moving into desorbtion, from a single seam. Five of the production wells have recently been completed in a second seam. It is anticipated that the next wells to be drilled will be completed in two seams.

During the week of June 27, 2005, a vertical well will be drilled and tested and ultimately will become part of a 3-well horizontal pilot utilizing BHP Billiton's Medium Radius Drilling (MRD) techniques. BHP Billiton (NYSE:BHP)(BBL Australia:BHP.AX)(LSE:BLT.L) is providing technical services for these wells as outlined in the Technical Service Agreement the Company signed with BHP in April, 2005.

The Company previously announced that its goal was to have 100 production wells at the Delta Project by yearend.

At the Jericho Project, five of twelve new production wells have been drilled and are awaiting completion. By the end of summer, over forty wells will be in production at this Project.

At the Montgomery Project, testing of the first three test wells has been completed and a forth test well is being sited and permitted in an area that ultimately would become the Company's next Development Project.

Jim Azlein, President & CEO states "We continue to make steady and substantial progress in quantifying and growing our asset base in the Illinois Basin."

About BPI Industries Inc.

BPI Industries is a Canadian, publicly listed, oil and gas exploration company that currently controls 418,435 acres of coal bed methane rights in the Illinois Basin. Its assets include a 100% owned leasehold interest in a contiguous 43,000 acre coalbed methane property in the southern portion of the Illinois Basin (Delta Project); options and a lease on four additional acreage blocks totaling 239,487 acres of coalbed methane property in the north central portion of the Illinois Basin (Montgomery Project) and options and leases for 135,948 acres in the north western portion of the Basin (Washington Project). In addition, the Company indirectly owns an 11.03% interest in the 43,000 acre Jericho Project in Sullivan County, Indiana, in the eastern portion of the Illinois Basin. The Jericho Project was the first producing in-seam coalbed methane project in the Illinois Basin and BPI is the technical manager of that project. BPI recently initiated sales of gas production from its Delta Project in Illinois where the company is actively drilling new production wells.

BPI additionally has negotiated purchase options to acquire 147,000 acres of coal in Shelby, Clinton, Christian and Marion Counties, Illinois. The Company is in the process of exercising and converting these options to additional CBM rights in the Illinois Basin.

BPI's wholly owned subsidiary, Illinois Mine Gas LLC (IMG) plans to commercially produce coal mine methane gas from abandoned mine works in the Illinois Basin. Production will start with the 20,000-acre area of abandoned mine works at the Company's Delta Project where IMG is currently testing seven wells that it has drilled into abandoned mine works.

BPI has invested in excess of Cdn$ 18.5 million in the Illinois Basin to date on acquisition, testing, evaluating and defining of oil and gas opportunities. BPI is now focused on coal bed methane and coal mine methane exploration and development in the Illinois Basin. There are two major gas pipelines that cross all of BPI's acreages, providing a ready access to markets for future gas production. The common shares of the Company trade on the TSX Venture Exchange under the symbol "BPR".

ON BEHALF OF THE BOARD OF DIRECTORS

James G. Azlein, President

This news release shall not constitute an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction. The securities of the corporation have not been registered under the U.S. Securities Act, 1933, as amended, and subject to certain exemptions may not be offered or sold in the United States or to U.S. persons.

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

Contact Information

  • BPI Industries Inc.
    James G. Azlein
    President
    (440) 248-4200 or Toll Free: 1-800-803-3204
    (440) 249-4240 (FAX)
    www.bpi-industries.com