Gale Force Reports on Phase 1 Development for Kentucky Shale Gas Play

Gale Force has announced further interim results from its initial "Phase 1" development program on its Kentucky Appalachian Shale Gas Property.

The Corporation has now completed 5 of the 9 wells on the property that had never been completed, focusing primarily on stimulating the organically rich hydrocarbon-bearing intervals within the Devonian Shale source rock using fracture stimulation. The Corporation has obtained test results from the 5 wells, which demonstrate that an average vertical well drilled on the Kentucky Property will recover capital cost payback in less than 2 years with NYMEX at a constant $7.00 per Mcf, with a prospective internal rate of return greater than 50%.

On September 24, 2008, the Corporation announced that it had re-entered and started natural gas production from 4 of 9 existing wells on the Kentucky Property that had already been completed. The Corporation will now tie-in the remaining 5, newly completed wells.

The recent workover and completion program has proven that there is consistent natural gas potential across the Kentucky Property, confirming that there is low-risk drilling for the Devonian Shale target. There are more than 200 potential drilling locations adjacent to the existing infrastructure, which means that the Kentucky Property is an excellent candidate for a low-cost, multi-well drilling program designed to generate cash early in the project development and increase the net present value of the reserves on the property.

"These are great results, which strongly suggest that the Kentucky Property can create tremendous economical value if developed on a larger scale," said Michael McLellan, President and CEO. "These results are in line
with what we told investors they could expect when we acquired the prospect."

The Kentucky Property was acquired by the Corporation on July 27, 2008 and included nine existing wells on the 22,000 acres of leased land with ready access to market via existing pipeline infrastructure. Subject to new financing, the Corporation will also drill and core additional wells on the Kentucky Property and attempt alternative exploitation techniques such as horizontal drilling, underbalanced drilling and open-hole completions, all of which could improve the development template for the Kentucky Property, permitting the Corporation to accelerate recovery of the gas resource and create greater net asset value of reserves.