Galena Capital Corp V.FYI

Galena provides update on Matagorda Bay prospect

[biznotstock]

Galena provides update on Matagorda Bay prospect
2011-10-06 12:02 ET - News Release
Mr. Michael Leahy reports
Galena Capital Corp. has provided the following operational update regarding its Matagorda Bay prospect. South Bay Resources LLC, has advised that the Parker 76B rig arrived under tow on location at the 127-1 well site at 10:30 p.m., Wednesday Sept. 28, 2011. recompletion activities have commenced; the perforation of the Bol Mex sand scheduled to occur in the next several days, immediately followed by a Frac Pack. Testing of the well will follow the completion of the Frac Pack procedure. As a result of operational changes including the addition of a Frac Pack procedure to the completion, the AFE for this operation has escalated to approximately $2.6-million (U.S.). The company is funding its share of this increase (approximately $258,000 (U.S.)) by way of a sale of an 8 per cent interest in the project; thereby reducing its working interest from 23 per cent to 15 per cent.
About the Matagorda Bay Prospect The Matagorda Bay recompletion project comprises approximately 1,600 acres and consists of Texas state blocks 127, 150 and the north half of block 151, and includes three existing well bores, an existing seven mile pipeline to shore and an onshore oil/gas handling facility. A key component of this acquisition is the existence of a fully drilled, cored, logged, cased and shut-in well bore (the 127-1 well) in Block 127. The 127-1 well has multiple pay zones indicated on logs and cores and is expected to be initially completed in the Bol Mex (8560 - 8710' depth) section of the Lower Frio. Internal analysis of the logs and cores of the Bol Mex zone indicate approximately 115 feet of expected oil pay. The reservoir is estimated to cover a minimum of 350 acres with potential up to 750 acres.

[biznotstock]

After the delays, why reduce your working interest right around the end?? If 8% = 258,000$ then they estimate the value of the whole project to be 3,225,000$ ??This makes no sense. I have a feeling they jumped the gun with the rare earth project and ran out of money to finance this one.Then again, if there's no oil. I'll have to take all this back and congratulate them for not

[rdwww]

who bot the 8% - did they drop it or did an insider buy it privately ?how goes that financing at 15 that was oversubscribed a few weeks ago ?sounds like a lot of $ flew the coop in the meantime and they cant find the cash for all the projects now