Montello Buys Land in Tennessee, Updates Wells, Cancels Financing

Montello Resources Ltd. has acquired additional leases totaling 190 acres to add to its land holdings within the Morgan Highpoint Area. The company is in the final stages of surveying the site for a proposed follow-up second test well to the John Bowen #2 Well, which is cased and scheduled to be logged in 2008.

Montello's Pincher Creek Operating JV Partner, Pennine Petroleum Corporation, has brought the 1-11 Well on production. Condensates are currently being trucked to market and gas production is being flared pending stable rates and tie in.

Montello's Operating JV Partner, Northern Sun Exploration Inc., has drilled and cased both wells at Grouard, Alberta. The first well 1-15-76-14-W5 has been completed as a gas well with testing ongoing, while the service rig will be onsite Dec. 29, 2007, to commence completion on the second well 10-3-76-14-W5. There have been discussions with Northern Sun about furthering the joint ventures in the area.

Montello has chosen to cancel the previously announced CDN $1.2 million Non Flow Through Non-Brokered Private Placement of up to 10 million Units at the price of $0.12 per Unit. Each Unit was to consist of one Common Share at $0.12 and one Common Share Purchase Warrant priced at $0.25.