Bounty to Buy Interest in Utopia Oilfield

Bounty Oil & Gas has agreed to purchase a 40% interest in the Utopia Oilfield, located in southwestern Queensland, approximately 150 km north east of the Jackson Oilfield and 50 km south of the Kenmore Oilfield.

Bounty is purchasing all of Nuenco NL's interest in four graticular blocks in ATP 560P, which includes the Utopia Oilfield. The field produces from the Early Cretaceous Murta Formation and is the largest known Murta pool in the Queensland Eromanga Basin. The most recent technical review of Utopia (June 2004) has determined the field may contain up to 2.86 million barrels of recoverable oil (P50 estimate). Utopia is presently producing approximately 45 BOPD from 3 wells and has produced approximately 50,000 BO to date.

In consideration for the interest, Bounty will issue to Nuenco 7,000,000 fully paid shares in Bounty and pay a total A$750,000 cash in staged payments. The entire transaction is valued at A$1,500,000 and is subject to pre-emptive rights held by Utopia Joint Venture partner Oilwells Inc. of Kentucky, which they have 30 days to exercise.

Bounty Managing Director, Tom Fontaine said "We are pleased once again to be a producer of hydrocarbons. This is an excellent deal for Bounty – not only have we purchased over 1.1 million barrels of proved and probable reserves net to Bounty, but there is additional exploration potential in the area. We are looking forward to working with the Operator in advancing both the exploration and production opportunities in and around this field."

On completion of the deal, partners in the Utopia Oil Field will be Bounty Oil & Gas with 40% and Oil Wells Inc of Kentucky as operator with 60%.