Cypress Hills Resource Corp.

Cypress Hills Resource Corp.

March 06, 2008 17:00 ET

Cypress Hills Resource Corp.: Debenture Financing

CALGARY, ALBERTA--(Marketwire - March 6, 2008) - CYPRESS HILLS RESOURCE CORP. (TSX VENTURE:CHS) ("Cypress Hills" or the "Company") announces that it has received the conditional approval of the TSX Venture Exchange to raise working capital by the issuance of four $100,000 debentures. These debentures are intended to meet the Company's near-term capital requirements to fund its' continuing participation in the Armstrong Ranch Project in Kennedy County, Texas (the "Project").

The debentures will be unsecured, have a one year term, and bear a 12.0% annual interest rate. The debentures may be repaid at any time prior to their maturity by the Company. In the event the Company does a further financing, or asset sale, or if the debenture funds are not required for the Project, then the debentures will become repayable prior to their maturity. As bonus consideration for entering into the debentures the Company will issue 100,000 common shares to each of the debenture holders. These shares will be subject to a four-month hold period from the date they are issued.

Two of the four debentures will be purchased by directors of the Company, the third by an accredited investor and the fourth will be sold to an additional accredited investor.

The proceeds of the debentures will be used for the Company's portion of the costs to complete, fracture and to tie-in the Project's first well and to cover increased drilling costs of the first well due to lost circulation and an increase in depth drilled. The proceeds will also be used if the decision is made to go ahead with the Project's second well. The Company is carrying 10% of the costs and receiving 10% of the revenues from the Project's first well until payout, reduced to 7.5% of costs and revenues upon payout. On any additional wells drilled on the 1,477 acre lease the Company will be responsible for 7.5% of the costs and will receive 7.5% of the revenues.

Cypress Hills is a junior oil and gas company focused on drilling multi-zone crude oil and natural gas prospects in Alberta and Texas.

Additional information on the Company and its projects can be viewed at or


No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. This news release includes certain "forward-looking statements". All statements other than statements of historical fact included in this news release, including, without limitation, statements regarding reserves, present value of future cash flow, exploration results, and future plans and objectives of Cypress, are forward looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from Cypress' expectations are exploration risks, production risks and pricing risks detailed herein and from time to time in other filings made by Cypress with securities regulators.

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

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