Mainland Resources has increased its working interest in the Buena Vista Prospect. Additionally, the company's planned drilling on both the Buena Vista well in Mississippi, and Cotton Valley well in Louisiana are proceeding on schedule.
Mainland reported on April 22, 2010 that it had closed the sale of its interest in the Haynesville formation of the East Holly Prospect in Louisiana to EXCO Operating Company, LP, for approximately $28.2 million. As a result of this sale, management expects that the Company has sufficient funds on hand to drill the Buena Vista and East Holly wells.
The Company's working interest in the Burkley-Phillips No.1 well has increased from 45.9% to 72%. Mainland will fund 90% of the well costs to earn its 72% interest in the well. As Operator, Mainland has a scheduled spud date of early June 2010. Mainland's working interest increased to 72% due to non-payment by American Exploration Corporation as reported in the Company's press release on April 26, 2010. Mainland currently holds interest in excess of 17,000 acres in the Buena Vista Prospect.
Guggenheim Partners, LLC will fund 10% of the well costs to Mainland in order to earn an 8% working interest in the Burkley-Phillips No.1 well.
Mainland is finalizing the drilling contract for the Buena Vista well with RAPAD Drilling & Well Service, Inc., of Jackson, Mississippi. RAPAD is a highly experienced and reputable driller who will provide the rig to drill the 22,000-foot Haynesville Shale well on the Buena Vista Prospect.
COTTON VALLEY DRILLING, EAST HOLLY PROPSPECT, LOUISIANA
The Company holds a 100% working interest in 2,745.65 net acres in the Cotton Valley, Hosston and Upper Bossier formations located on the East Holly Prospect in Louisiana and plans to spud the first well as Operator by late May or early June, 2010. The four recent wells drilled by the original Operator through the Hosston and Cotton Valley zones to the Haynesville formation calculate as productive.
Mainland is finalizing the drilling contract with Brammer Engineering, Inc., Shreveport, Louisiana to act as contract operator. Brammer, a highly regarded drilling contract operator with extensive experience in North Louisiana, will drill the Company's first well specific to the Cotton Valley, Hosston and Upper Bossier formations on the East Holly Prospect.
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