Lexington Acquires Middlecreek Prospect

Hughes County, Oklahoma
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Lexington Resources has reached an agreement to purchase a 320 acre drilling target in the Middlecreek Gas Prospect located over two sections of Hughes County, Oklahoma. The purchase includes wells on the property with minor production from the Gilchrease zone that secure the lease. The lease represents a 70% net revenue interest in the acquired lands and a 100% working interest. Rights to drill all geological zones are included and primary gas targets include the Caney shale and Hartshorne Coal zones with further possibilities in the Booch, Stuart and Savannah zones. The acreage is being acquired for $175 per acre.

A drilling rig has recently been scheduled to arrive on the prospect to begin drilling operations before the end of the month. A vertical well into the Caney shale zone is planned at an estimated depth of 4,500 feet. The property includes a 2,000 foot gas pipeline and pipeline right of way. Many producing wells are located in the area of mutual interest with an offsetting Caney shale well with excellent production capability less than two miles away.

The acquisition will bring current drillable acreage for the Company to almost 4,200 acres with properties in the Wagnon, Panther, Coal Creek, South Lamar, and Middlecreek prospects in the State of Oklahoma's Arkoma basin. Lexington Resources is in negotiations for additional tracts of potential gas-producing acreage in the areas adjoining all leases to expand property locations and increase total drilling area capacity. Acreage obtained has been carefully selected in areas with expanding production and drilling activity to minimize future drilling risks and maximize future production.

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