Corridor Resources Inc.

Corridor Resources Inc.

May 04, 2007 07:33 ET

Corridor Updates Drilling, Development and Exploration Activities in New Brunswick

HALIFAX, NOVA SCOTIA--(CCNMatthews - May 4, 2007) - Corridor Resources Inc. (TSX:CDH) reported today that the McCully P-76 well was drilled to a total measured depth of 2769 meters in the Frederick Brook formation. The well encountered a total of 33 meters of net gas pay in the Hiram Brook formation based on well logs (16 meters in the "B" sand and 17 meters in the "A" sand), and is the 21st successful gas well in the McCully Field. The well penetrated 229 meters into the Frederick Brook formation, consisting primarily of shale and siltstone and exhibiting fracturing and gas shows. The well has been cased and suspended in preparation for fraccing and production testing planned for later this summer. Following well completion and testing operations, the P-76 well will be tied into the McCully gathering system and is expected to commence natural gas production to the McCully natural gas plant in November. The Nabors #86 drilling rig is being relocated to drill the McCully D-66 well from the same surface pad. Corridor has a 100% working interest in the P-76 well, while the D-66 is a joint (50/50) well with Potash Corporation of Saskatchewan.

The Nabors #4 (double) drilling rig is drilling ahead at a depth of 2798 meters in the Hiram Brook formation at the McCully E-38 well. Corridor expects to complete drilling, logging and casing operations at E-38 by the end of the third week of May and will report on results at that time. Corridor has a 100% working interest in the E-38 well.

Corridor has advanced the timing for conducting its next multi-well frac program at McCully. Current plans are to commence a seven-well frac program near the end of July and to complete the program by mid September. Included at the commencement of this program is a two-stage testing of two intervals in the Frederick Brook formation at the McCully F-58 well drilled earlier this year. It has been decided to conduct these Frederick Brook tests in conjunction with the frac program rather than as previously planned for early June since much of the equipment required to conduct these tests will also be needed for the frac program. The initial tests for the Frederick Brook shale in F-58 will consist of perforating the casing and squeezing acid into the perforations in an attempt to connect with the natural fractures indicated to be present in the formation. If these initial (conventional) tests are unsuccessful, plans are to frac and re-test the intervals as part of the summer frac program.

Corridor has completed the installation, burial and pressure testing of the gathering system and the main pipeline which connects the McCully gas plant with the Maritimes & Northeast Pipeline (M&NP). Construction of the gas plant is nearing completion, with activities now concentrated on final electrical equipping and commissioning of the plant. The capital cost of the gathering system, gas plant and pipeline facilities is approximately $60 million and production to M&NP is expected to commence in the middle of June, following receipt of an operating permit from the New Brunswick Energy and Utilities Board.

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Corridor Resources Inc. is a Halifax, Nova Scotia based company focused on exploring and developing natural gas resources in the McCully Field and surrounding areas of southern New Brunswick. The Company is in the latter stages of constructing a field gathering system, a gas plant, and a pipeline lateral to connect the McCully Field to markets through the Maritimes & Northeast Pipeline (M&NP). The Company plans to initiate natural gas production to M&NP by mid June, 2007, at a planned initial gross rate of 35 mmscf/day (approximately 63% net to Corridor), and has a continuous development drilling program underway to add reserves and production capacity as field development expands. Corridor also has a number of potentially high impact exploration projects planned in New Brunswick and elsewhere in eastern Canada.

Forward Looking Statements

This press release contains certain forward looking statements relating to, but not limited to, Corridor's operations, anticipated financial performance, business prospects and strategies, including expectations relating to production levels; capital expenditure programs; the quantity of natural gas reserves; projections of market prices; projections of costs; supply and demand for natural gas; expectations regarding the ability to raise capital and to continually add to reserves through exploration and development; treatment under governmental regulatory regimes; and expectations regarding the construction of the necessary midstream facilities to connect the McCully Field to the M&NP. These statements are based on current expectations that involve numerous assumptions regarding factors and risks that could cause actual results to vary materially, including, without limitation to, the following factors: risks associated with oil and gas exploration, financial risks, substantial capital requirements, bank financing, delay in construction of midstream facilities, government regulation, environmental, prices, markets and marketing, dependence on key personnel, dependence on Potash Corporation of Saskatchewan, Inc., availability of drilling equipment and access, risks may not be insurable, management of growth, expiration of licenses and leases, reserves estimates, seasonality, competition, conflicts of interest, Kyoto Protocol, issuance of debt, title to properties and hedging. There is no representation by Corridor that actual results achieved will be the same in whole or in part as those set out in the forward looking information. Furthermore, the forward looking statements contained in this press release are made as of the date hereof, and Corridor undertakes no obligation, except as required by applicable securities legislation, to update publicly or to revise any of the included forward looking statements, whether as a result of new information, future events or otherwise.

Contact Information

  • Corridor Resources Inc.
    Norman W. Miller, President
    902-429-0209 (FAX)