Admiral Bay Resources Inc V.ADB

News

[ATLEVAN]

Admiral Bay Update: Near Term Development Program for Cherokee Basin Projects 16:10 EDT Friday, September 07, 2007 CENTENNIAL, COLORADO--(Marketwire - Sept. 7, 2007) - Admiral Bay Resources Inc. (TSX VENTURE:ADB) ("Admiral Bay" or the "Company") is pleased to announce that further to its news release of August 29, 2007, the Company is now in receipt of its initial funding from its newly established credit facility. With this funding, the Company has paid off its previous credit facility, outstanding accounts payable and has the funding in place to bring new wells into production that were originally drilled in the 2006 Development Program and not completed. Upon completion of the current year's reserve report, anticipated in the next 30 days, an additional US$2.5 million will become available from the credit facility to begin a drilling program once this initial completion and tie-in work is finished. Current Status of the Projects The Company currently has 164 wells in production - 108 at the Shiloh project, 27 at Mound Valley and 29 at Devon. Wells completed from the 2006 Development Program have consistently shown better production results than earlier wells, due to changes in completion techniques. Production at the Shiloh project has fluctuated greatly over the last four months due to compressor issues. The compressor which was causing the problem has recently been replaced and it appears that this has resolved the issue. Management is confident that given uninterrupted periods of production for the wells at the Shiloh project, production will increase as the system pressure is reduced and de-watering occurs allowing wells to move towards peak rates. Development Program Under the development program being implemented, Admiral Bay will focus on bringing its remaining wells from the 2006 Development Program on production. Funding for this program is in place and will be completed in two phases. The program will include completion work, addition of well equipment, the addition of 5+ miles of flow lines and 10+ miles of gathering system. Total cost for this development program is estimated at US$1.73 million. The first phase will focus on new wells being completed and brought into production. When complete, this will put 31 new wells on production. The second phase will primary focus on reworking older wells and opening up new areas. This will add an additional 7 wells to production along with 5 wells that will be refraced in the Shiloh area. Phase one and two will bring an additional 43 wells into production and is estimated to be complete by the end of the November. Once complete, Admiral Bay will have over 200 wells in production. A third phase will follow, that will include the drilling and completion of 20 - 25 new wells at the projects. Funding for this phase will come from the increase in the credit line borrowing base after receipt of the updated reserve report. Additional wells will be drilled in small groups following the completion of this third phase. "With funding in place from our new credit facility, we can once again become more aggressive with our development work in the field", stated Steve Tedesco, President of Admiral Bay. "Work has already begun to complete wells not in production from our 2006 Development Plan. We look forward to reporting results of this work in the near future". The Company also announces that it has granted 675,000 incentive stock options to officers and directors of the Company at a price of $0.23, which are exercisable until September 6, 2012. Admiral Bay Resources Inc. (www.admiralbay.com) is an emerging unconventional gas production company focused on the development of projects in the Cherokee Basin in southeast Kansas and the Appalachian Basin in Pennsylvania. Admiral Bay is listed on the TSX Venture Exchange under the symbol ADB. Statements in this release that are not historical facts are "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Readers are cautioned that any such statements are not guarantees of future performance and that actual developments or results may vary materially from those in these "forward-looking statements". FOR FURTHER INFORMATION PLEASE CONTACT: Admiral Bay Resources Inc. Steven Tedesco President & C.E.O. [phone] [phone] (FAX) Email: [e-mail]