Golden Cariboo Resources Ltd.
TSX VENTURE : GCC

October 24, 2005 13:26 ET

Golden Cariboo Resources Ltd.: Participation Agreement Signed to Earn up to 96 Sections with Mystique Energy Inc.

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Oct. 24, 2005) - The Board of Directors of Golden Cariboo Resources Ltd. (the "Company") (TSX VENTURE:GCC) is pleased to announce that it has entered into a participation agreement with Mystique Energy Inc. ("Mystique") of Calgary to drill six test wells. The test wells to be drilled are located on lands that are held by one of North America's leading oil and gas companies (farmor) in the Lochend/Bottrel areas which are located northwest of Calgary. The Company must pay 30% of the costs to drill and complete each test well to earn a 15% working interest in each of the test wells.

Upon completion of the six test wells the Company will have earned a 15% working interest in 12 sections of land. Furthermore the Company will have the option to participate in the drilling of up to 42 more wells (option wells). Each option well will earn the Company an additional section of land. If all 48 wells (option and test) are drilled, the Company will have earned a 15% working interest in 96 sections of land. The Company will pay 30% of the costs to drill and complete each well to earn a 15% working interest in each of the 42 option wells drilled. Subsequent to this, the Company will pay 15% of the costs of drilling and completing to earn a 15% working interest in the drilling of development wells on this land package. If the farmor elects not to participate in the development wells the Company will pay 30% of the cost to earn a 30% working interest. Depending on the target formation, one gas well or four oil wells could be drilled on each section of land. The following table illustrates the agreement:



--------------------------------------------------------------------
the Company pays 30% of costs To earn 15% in 12
in 6 test wells sections of land

the Company pays 30% of costs To earn 15% in 84
in 42 option wells sections of land
--------------------------------------------------------------------
At this point after drilling 48 (test EARNED 96 sections
and option) wells the company would hold of land
a 15% interest in
--------------------------------------------------------------------
At this point all subsequent wells are EARNED 96 sections
development wells whereby the company of land
will pay 15% of cost to earn a 15%
interest in the wells and up to 30% of
costs to earn a 30% working interest if
the farmor elects not to participate
--------------------------------------------------------------------


In all wells drilled, if the farmor elects not to participate in the cost of equipping the wells, the Company's interest will increase from 15% to 18%.

Pursuant to the agreement the Company has posted a $300,000 standby letter of credit as well as paid $282,450 for its share of drilling costs for the first test well. The well is to be drilled to a depth of 2,587 meters to test the Cardium formation.

On Behalf of the Board of Directors

J. Frank Callaghan, President and CEO

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
    President and CEO
    (604) 669-6463 or Toll Free: 1-800-663-9688
    (604) 669-3041 (FAX)
    info@wayside-gold.com