SOURCE: OMDA Oil and Gas, Inc.

February 16, 2006 13:29 ET

OMDA Oil and Gas, Inc. Negotiates to Sell Panola County Lease

HOUSTON, TX -- (MARKET WIRE) -- February 16, 2006 -- OMDA Oil and Gas, Inc. (OTC: OMOG) is pleased to announce that it is negotiating with a fully reporting bulletin board company to acquire OMDA's Panola County Lease. OMDA currently owns a 100% working interest in this 1,116-acre horizontal play in Panola County, TX. This was one of OMDA's first lease purchases under new management, and it was acquired when oil and gas prices were significantly lower.

The terms of this proposed agreement may include a stock payment to OMDA, as well as a cash dividend distributed directly to the shareholders of record of OMDA Oil and Gas, Inc. Further details will be released over the next few weeks as the terms are finalized.

Adam Barnett, Chairman, stated, "OMDA Oil and Gas, Inc. looks forward to completing this transaction. I have stated many times that our company was extremely fortunate to acquire most of our assets prior to oil and gas prices making their big moves upward. We were able to purchase the Panola lease for $100,000, and we feel that this property is worth much more than that amount now based on current market valuation. Through these types of acquisitions and agreements, the company and our shareholders will reap the benefits of our asset appreciation."

More information on both OMDA's Oil and Gas projects and legal actions can be found at the Company's website, http://www.omogoil.com

About OMDA Oil and Gas, Inc.

OMDA Oil and Gas, Inc. and its wholly owned subsidiaries, OMDA Oil & Gas Management, Inc. and Texas OMDA Drilling & Operating, Inc. and OMDA Oil & Gas, Inc. (Texas), are in the business of oil and gas production and lease acquisition. Currently the Company owns average participation interests approaching 47% in 355 producing and non-producing oil and gas wells in Louisiana and Texas, as well as 100% gross interest in an undeveloped 1,116-acre horizontal play in the Panola Field, Panola County, Texas. Current acreage interests include a 15% working interest in 800 acres in Shelby County, TX and a Carried back-in working interest of at least 7.5% up to 37.5% in a 12 well work over play in the Concorde Dome Field in Andersen County, TX, and is currently partnered up with Young Oil Corp, the largest Oil and Gas producer in Tennessee on 46,000 acres in North Central Tennessee, with an initial 20% interest in a six well program and a first right of refusal on any other prospects on the Young leases.

This release includes forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties including, but not limited to, statements relating to the future anticipated direction of the Oil and Gas Industry, plans for expansion, various business development activities, planned capital expenditures, future funding resources, anticipated sales growth and potential contracts. The Company is not obligated to revise or update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release.

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