Admiral Bay to Begin Drilling of 7-Well Test Program in Appalachian Basin

Admiral Bay Resources Inc. reported that the seven well drilling and test program at its Revloc project in the Appalachian Basin in Pennsylvania will begin next week. This drilling program was originally scheduled for December, but due to significant weather conditions through the month of December in Pennsylvania, the start of drilling has been delayed. The drilling locations have now been built for all seven wells and the rig is in the process of being moved to the first location. Three of the seven wells will be cored for testing, with casing to be run on all wells.

At the Mound Valley project, the Company has begun its recompletion program in the Mulky and Summit shales. The first well completed, the Obrien 2-35, reached peak production within two months, exceeding 100 MCFGPD and then stabilizing at 80 - 100 MCFGPD. A second well, the Obrien 8-35 was completed with a similar frac and after only two weeks is producing at a rate of over 25 MCFGPD. Two additional wells fraced have been placed back on line in the last week and are showing similar results as the Obrien 8-35. All three wells presently have high fluid levels. Production is expected to continue to increase as the fluid levels come down. A further 6 wells are being fraced this week in the project area and will be put back online shortly. As the results continue to come in, and if they remain consistent, the Company will attempt to recomplete all of the existing wells in the Mulky and Summit shales, adding to the existing zones that are open in each well.

At the Shiloh Project, the Company has recompleted a number of the wells in the Riverton Coal. With the indication of success at Mound Valley, the Company is now looking at recompleting some of the wells in the Mulky and Summit shales at this project as well. These shales are also present at the Company's Santa Rita, Devon and Swordfish projects.

Admiral Bay is presently receiving bids for completion of the Chattanooga Shale at its Santa Rita Project. There are a handful of wells in the Cherokee Basin that are currently producing from this shale. The Company is looking at the using slick water fracs on this shale. Testing on these wells is expected to begin over the next couple of months, depending upon service company availability and winter weather conditions in Kansas.

The Company also announces that it has granted 100,000 incentive stock options to an officer at a price of $0.21, exercisable until January 25, 2011.