Corridor Resources Hopeful About McCully Wells

Corridor Resources Inc. reported that testing operations have been completed for wells drilled and stimulated during the previous (2007) frac campaign. Two of these wells (McCully D-66 and P-76) have been placed on production to the McCully gas plant while hook-ups for the remaining wells (D-67, I-67, F-58 and J-38) are expected to be completed during the month of March. Final tested flow rates for these wells are shown in the following table, along with the current flow rates for the producing D-66 and P-76 wells.

To date, the sands of the E-38 well have failed to produce natural gas at any significant rate due to an abundance of bitumen damaging formation permeabilities. Corridor is planning further workovers in the well to attempt to stimulate gas production.

The total gas production rate for the field is expected to be approximately 31 mmscf/day (22 mmscf/day net to Corridor) by the end of March once the tie-ins for the D-67, F-58, I-67 and J-38 wells are completed and these wells are on stream and producing against an average gathering system pressure of approximately 600 psi. Further clean-up of injected frac fluids is expected to occur in these wells during early stages of production which may result in increased rates of production in some wells. However, as currently forecast, the gross field production for April (including the additional wells) is approximately 2.5 mmscf/day less than Corridor had previously forecast.

Despite a loss is production however, based on first quarter gas pricing and the outlook for gas prices for the balance of the year, 2008 decrease in revenues resulting from a reduced production forecast will be offset by the increase in revenues resulting from higher gas prices.

Corridor is encouraged by the initial flow test results in the McCully J-38 well despite the presence of bitumen in the reservoir and wax observed in the wellhead following flow testing operations. The company is planning another eastern delineation well (C-29) to be located to the northeast of J-38 and drilled in June, 2008. If C-29 is successful there are numerous additional locations to be drilled in this eastern extension of the McCully structure, where a younger set of relatively thick and porous gas-bearing upper Hiram Brook sands are present. Another key well is McCully J-47 which is currently drilling and which has penetrated a thick section of highly prospective upper Hiram Brook sands at that location.

Corridor has completed drilling, casing and logging the McCully K-48 well (Nabors Rig #86) and is now drilling the McCully J-47 well (please refer to the map below) from the same well pad at a current measured depth of approximately 2,640 meters in the upper Hiram brook formation. The K-48 well encountered 20 meters of indicated natural gas pay in the "B", "C" and "D" sands based on a 4% porosity cut-off. The well will be fractured in these intervals during the upcoming frac program planned for this summer and will be placed on production this fall.

The McCully E-67 well is drilling ahead (Nabors Rig #58) at a depth of 3,850 meters in the Frederick Brook shale formation. The well has encountered significant shows of natural gas in the Frederick Brook shale formation and is attempting to reach and penetrate the underlying Dawson Settlement formation. The company flared substantial volumes of natural gas during tripping operations. The E-67 well is now the deepest drilled to date in New Brunswick and is expected to reach total depth in late March.

Efforts to date to assess the productive potential of the Frederick Brook formation have been limited to incremental evaluations in vertical wells intended primarily as Hiram Brook producers. A horizontal well at Elgin will be subjected to multiple large fracs in an extended horizontal leg, followed by long term flow-back and testing and will be Corridor's first effort to apply techniques that have been proven successful in shale gas plays such as the Barnett shale in Texas. The Frederick Brook shale is exceptionally thick within the McCully structure and extends over a large area to the northeast and within the Elgin lease area. The shale appears to have all the ingredients for successful extraction and development, including total organic content, headspace gas measurements and thermal maturity levels. Corridor is planning a multi-well shale gas pilot project in the Elgin area for 2009.

"We are excited about the enormous potential of this play and applying the technology that is known to be working in shale gas plays elsewhere on the continent" said Norm Miller, Corridor's President.