VANCOUVER, British Columbia, June 29, 2004 (PRIMEZONE) -- Montana Oil & Gas (Pink Sheets:MOGI) Montana announces an agreement with Energy 51, a private oil and gas exploration and development company based in Calgary, Alberta. Montana has acquired an option to purchase up to 36.25% of Energy 51 for $675,000 (USD) payable over the next 4 months. Montana also has the right of first refusal to acquire further equity interests in Energy 51 from time to time. In keeping with the agreement, Montana will appoint one third of Energy 51's Board Members.
Under the terms of the agreement, Montana also has a first right to participate in drilling a minimum working interest of 25% of all oil and gas prospects developed by Energy 51 over the next two years. These joint venture projects will have the potential to generate significant production revenue for Montana this year.
The President of Montana, Peter Sanders, notes "This is a significant agreement for our Company, we are now positioned with a senior group of petroleum geologists, engineers and landsmen who have an enviable discovery track record in the Western Canadian petroleum Industry. Their success record over the last 10 years is 74%, which is better than industry average, and we have the right to drill considerable prospects in keeping with a nominal promote from Energy 51. We expect to announce our initial drilling joint ventures in the next few days"
Energy 51 is an Alberta based private company managed by a proven team of professionals whose direct oil and gas industry experience is well in excess of 100 years. Some of their previous successes include Macedon Resources Ltd., Summit Resources Ltd., Eurogas Ltd., Barrington Petroleum Ltd., and Lexoil Inc. All companies were sold at premiums to the original shareholder equity costs and discovered more than 50 million barrels oil equivalent reserves.
Initial projects will be located in Central Alberta within 110 townships, which the Energy 51 principals have given expertise and previous success. The region offers multi zone productive capabilities, year round access to drilling locations, low operating costs, and under utilized delivery infrastructure including gas gathering systems and pipelines to market. In relative terms, Alberta offers large tracts of unexplored lands in comparison to the known petroleum basins within the United States.
Safe Harbor statement under the Private Securities Litigation Reform Act of 1995: Except for historical information contained herein, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties, including but not limited to economic, competitive, governmental and technological factors effecting the Company's operations, markets, products and prices and other factors discussed in the Company's various filings with the Securities and Exchange Commission.