BrazAlta Resources Corp.
TSX VENTURE : BRX

BrazAlta Resources Corp.

September 13, 2005 09:00 ET

BrazAlta Announces Proposed Acquisition and Joint Venture of Four Brazilian Oil and Gas Fields in Central Brazil

CALGARY, ALBERTA--(CCNMatthews - Sept. 13, 2005) - BrazAlta Resources Corp. (TSX VENTURE:BRX) ("BrazAlta" or the "Corporation") is pleased to announce the proposed acquisition of a 47.50% working interest of oil and gas rights in four land blocks, ("Blocks"), in Brazil known as the Reconcavo area. Collectively these blocks produce 300 barrels of oil per day and comprise of 160 Square kilometres of land located in central eastern Brazil.

The Reconcavo area is in the State of Bahia, Brazil, and is approximately 50 km Northwest of the City of Salvador and the Atlantic Ocean. The areas have 12 producing oil wells and 40 suspended wells. These Blocks have been in production since 1981 and to date have produced in excess of 2 million bb/s of light sweet oil, (approximately 40 degree API), the fields have extensive pipeline and road infrastructure. BrazAlta also acquires a 47.50% interest in two oil batteries each with 1,500 barrels per day of capacity.

The fields have considerable amount of technical data. BrazAlta will acquire well data for over fifty wells and an extensive Seismic database. Approximately 40% of the lands are covered by 2D Seismic Data and additional 20% are covered by 3D Seismic Data.

The Blocks are currently held 100% by a private Brazilian oil and gas company ("Partner"). The consideration for the interest in the Blocks will be made by the issuance of 7,440,000 Common Shares of BrazAlta to its Partner in exchange for the 47.50% interest. The deemed price for the issuance of the BrazAlta Shares will be CDN $0.75. In addition BrazAlta has a right of first refusal to acquire an additional 47.50% interest in the above mention fields.

It is anticipated that the Blocks will be transferred upon closing to a partnership structure and then, following regulatory approval, to a joint venture company ("JV Company") owned 47.50% by BrazAlta and 47.50% by its Partner.

BrazAlta and its Partner have developed a multi phase success based initial development and exploration program for the Blocks. BrazAlta has committed to spend the first USD$10,000,000 to the partnership and the JV Company.

The first phase will include the implementation of a water flood program and reactivation of a number wells which also includes the drilling of two additional infill locations and one step out location at a total cost of USD $5,400,000 on existing concession lands. The second phase will involve, the drilling and completion of an additional eight (8) exploration wells, at an estimated total cost of CDN $4 million also on existing lands.

BrazAlta has retained DeGolyer and MacNaughton Canada Limited to perform a preliminary reserve assessment of the proposed properties:



Reserves Total (bbl)

Producing 602,144

Non-Producing 224,789

Proven Undeveloped 575,252

Total Proven Reserves 1,402,185

Probable Additional 248,117

Total Proven + Probable Reserves 1,650,303

Total Proven + Probable + Possible Reserves 1,891,279


The reserve numbers above are based on 100% working interest in the field. The reservoirs are mature with current recovery in excess of 20% of original oil in place. The forecasted development activities are generally low risk and would be expected to yield positive economic return. (source: DeGolyer and MacNaughton Canada Limited).

Completion of the transaction is subject to a number of conditions, including but not limited to Exchange acceptance. The transaction cannot close until the required Exchange approval is obtained.

In addition Mr. David Mears has assumed the role of President & CEO and Mr. John MacMillan has assumed the role of Chairman of the Corporation.

This release may contain forward looking statements within the meaning of the "safe harbor" provisions of US laws. These statements are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward looking statements. BrazAlta does not assume any obligation to update any forward looking information contained in this news release.

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

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