Golden Cariboo Resources Ltd.

August 05, 2005 13:16 ET

Golden Cariboo Resources Ltd.: Participation Agreement in Deep Gas Test Well

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Aug. 5, 2005) - The Board of Directors of Golden Cariboo Resources Ltd. (TSX VENTURE:GCC) (the "Company") is pleased to announce that, subject to TSX Venture Exchange approval, it has entered into a participation agreement (the "Participation Agreement") with Arapahoe Energy Corporation (TSX VENTURE:AHO) on land located on the Tsuu T'ina First Nation (Sarcee Indian Reserve) immediately west of the City of Calgary, Alberta. The Company has acquired a 10% participation interest for $545,053 for the C1 et al "Sarcee 12-13-23-4 W5M" (the "12-13 Mississippian Test Well").

The 12-13 Mississippian Test Well was spudded on July 3, 2005 being drilled to an approximate total depth of 3,300 meters. This is an offset well to Shell Canada Limited's "Shell Sarcee No. 1" well drilled in 1958 which has produced 86.7 BCF to date and is still producing 1.446 MMCF per day. The primary objective is natural gas from the Mississippian-Turner Valley formation.

In the adjacent section, Shell Canada Limited's "Shell 12-6-23-3w5" well was drilled in 1953 and put on production in 1961. Tests varied from 17 MMCF per day to 51 MMCF per day depending on the interval tested and choke size used. This well has produced 92.4 BCF to date and is still producing in excess of 1 MMCF per day.

Operations through drilling and casing of the 12-13 Mississippian Test Well will take between 75 days and 90 days from the spud date and is expected to be completed by mid-September 2005. The operator for this test well is C1 Energy Ltd. (TSX:CTT).

The Participation Agreement calls for the Company to pay 10% of the drilling costs to earn a 5% working interest in the 12-13 Mississippian Test Well section lands. In addition, the Company has the right to earn a further 5% working interest in contiguous lands by paying 5% of the drilling costs for three additional wells. Regulations restrict the number of wells that can be drilled to one well per section.

Regionally, the Tsuu T'ina Lands are on trend with numerous producing fields encompassing several prospective horizons. Productive zones around and within the Tsuu T'ina Lands range in age from the Devonian Crossfield Member of the Wabamun Formation to the Late Cretaceous coals of the Horseshoe Canyon Formation. Probably the most significant reserves locally are found within the thrusted Mississippian carbonates of the Rundle Group.

A finders' fee of 300,000 common shares of the Company will be paid upon TSX Venture Exchange approval. These shares will be subject to a hold period of four months and one day from the date of issuance.

Samual Summers, P. Eng., a Qualified Person under NI 51-101, has reviewed and approved the contents of this news release.

On Behalf of the Board of Directors

J. Frank Callaghan, President

This news release contains forward-looking statements regarding the timing and content of upcoming programs. Actual results may differ materially from those currently anticipated in such statements. The TSX Venture Exchange has neither approved nor disapproved of the information contained herein.

Contact Information

  • Golden Cariboo Resources Ltd.
    J. Frank Callaghan
    (604) 669-6463 or Toll Free: 1-800-663-9688
    (604) 669-3041 (FAX)