Nextraction Energy Corp.

Nextraction Energy Corp.

May 19, 2010 09:00 ET

Nextraction Energy Corp.: Pipeline Construction Begins for Pinedale, Wyoming Well

VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 19, 2010) - Nextraction Energy Corporation (TSX VENTURE:NE) (the "Company") announced that its wholly-owned subsidiary, Nextraction Energy (US) Inc. ("Nextraction"), has commissioned pipeline construction to tie the Noble 6-24 well into existing gathering systems owned by Jonah Gas Gathering Company ("JGG"). Construction of the pipeline has commenced and will extend for 900 meters across private and federal land. 

The up-front construction cost of the pipeline will be carried by JGG and is estimated at US$490,000. Nextraction has entered into a gas gathering agreement with JGG that allows for Nextraction to reimburse the construction costs from gathering fees paid to JGG, with a minimum monthly fee of US$20,000 until the construction costs, plus ten percent (10%), are re-paid.

Nextraction has also entered into a gas processing agreement with Enterprise Gas Processing, LLC, a JGG affiliate, to process, strip and recover the liquid hydrocarbons from the natural gas and increase the net value payable to Nextraction's credit. Long term gathering and processing fees for the Noble 6-24 well are estimated at US$0.66 per mcfg sold.

In mid-February, 2010, the Noble 6-24 well was drilled, logged and production casing was set to a depth of 14,888 ft (4,652.5 meters). Nextraction is currently evaluating a 12-21 stage frac proposal and has scheduled the well for completion in late June-early July. With the pipeline in place prior to frac'ing the well, gas sales can begin upon completion of the well. 

In addition to the completion planned for the Pinedale well, a NI 51-101 technical report is also underway and is expected to be ready for publication in the weeks ahead. 

At present Nextraction is also completing its first of four "proof of concept wells" in the Chattanooga shale and conventional reservoirs on its project in the Appalachian Basin, USA.

About Jonah Gas Gathering Company (Jonah System)

The Jonah System is comprised of approximately 849 miles of pipelines ranging in size from four to 36 inches in diameter, five compressor stations totaling 278,500 horsepower and related metering facilities. The system, located in the Green River Basin in southwestern Wyoming, gathers and transports natural gas from one of the most prolific and active basins in the United States. Gas transported on the Jonah System is processed by Enterprise Gas Processing and others and delivered to several interstate pipeline systems located in the area that provide access to a number of West Coast, Rocky Mountain and Midwest markets.

About Nextraction Energy Corp.

Nextraction Energy Corp. is a Canadian junior oil and gas company engaged in the exploration and development of oil and gas resources in North America. Nextraction targets projects with known reserves that provide lower risk, high return development opportunities in both conventional and unconventional resource projects, where our technical expertise can be applied to enhance production. The Company is headquartered in Vancouver, BC, Canada, and is currently developing a tight-sands gas play on the Pinedale Anticline in the Green River Basin region of western Wyoming, and a large Chattanooga shale gas resource play in Eastern Kentucky and Tennessee.

On behalf of the Board of Nextraction Energy Corp.

Mark S. Dolar, President and CEO


Certain statements in this document may contain "forward-looking statements" or "forward-looking information" within the meaning of applicable securities legislation. Such forward-looking statements or information include, without limitation, forecasts, estimates, expectations and objectives for future operations that are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company. Often, but not always, forward-looking statements or information may be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes" or variations of such words and phrases or words and phrases that state or indicate that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Statements regarding future production, reserve additions and capital expenditures are subject to all of the risks and uncertainties normally incident to the exploration for and development and production of oil and gas. These risks include, but are not limited to, inflation or lack of availability of goods and services, environmental risks, drilling risks and regulatory changes. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements. Such forward-looking information represents management's best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially. The Company does not assume the obligation to update any forward-looking statement, except as required by applicable law.

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