VANCOUVER, British Columbia, Aug. 22, 2001 (PRIMEZONE) Soho Resources Corp. ("Soho") (CDNX:SOH) (http://www.sohoresources.ca) is pleased to announce that it has entered into an Option Agreement, (the "Agreement"), with Golden, Colorado-based Mtarri, Inc. ("Mtarri") to purchase direct interest in the Quest gas field.
The Agreement gives Soho the exclusive right to purchase 80% of Mtarri's 25% working interest in 4,440 acres and 80% of Mtarri's 10% working interest in 6,880 acres of the Quest Gas Field Project. Upon the exercise of the Option, Soho will control a direct and indirect interest ranging from an 8% interest in a small number of leases, up to a 37.5% interest in approximately 3,750 acres within the Quest gas field project leases. Soho's interest in the core portion of the project containing wells No. 16-21 and No. 1-22 will move from 3% to 23% on all undeveloped leases.
The agreement does not include the existing three producing wells, No. 6-28, No. 16-21, and No. 1-22, where ownership will remain at its current percentages to the base of the Mesa Verde Formation. If the option is exercised, Soho will acquire 80% of Mtarri's 25% interest in the spacing units for the producing wells, below the base of the Mesa Verde Formation.
Mtarri, within 12 months of the date of exercise of the Option by Soho, will retain the right of participation in one (1) development well that is an immediate offset to one of the producing wells. If Mtarri elects to increase its participation in one development well, Mtarri shall earn an additional 5% working interest in such well and Soho optioned interest will correspondingly decrease by 5% in the one development well only.
Soho has an option period of 60 days, from Aug. 14, 2001, in which to exercise the option under the Agreement. The Agreement is subject to the acceptance of the Canadian Venture Exchange.
About the Quest Gas Project
The Quest Gas Project is located in the Uintah Basin of northeastern Utah -- a prolific gas-producing region. The Quest Project is a basin-centered gas play, with more than 170 potential well sites, initially targeting shallow gas zones -- less than 1,000 meters (3,300 feet) -- in the Wasatch Formation. The Quest Project also has deeper gas zones in the Mancos B, Niobrara, and Dakota Formations, which will be evaluated later in the Project's development. Historically, nearby wells targeting these same formations throughout the Uintah Basin have produced ultimate recoveries of 0.2 to 6.0 BCF per well.
About Soho Resources Corp.
Soho Resources is an oil and gas exploration company actively exploring prospects in the Uintah and Williston Basins in the United States, and in the Michigan Basin of Canada. Both directly and indirectly, Soho holds varying interests in four projects, including the Quest project in Utah (3% to 21.4% interest), the 80,000-acre Sundance project in North Dakota (37.5% interest), the Phoenix Project in southern Ontario (100% interest) and the Wolverine Prospect in North Dakota (100% interest).
Note: The Canadian Venture Exchange has not reviewed and does not take responsibility for the adequacy or accuracy of this release.