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Gold/Mining/Energy : Any Good Penny Resources Left? -- Ignore unavailable to you. Want to Upgrade?

To: mark warburton who wrote (725)	7/8/1998 11:12:00 AM
From: Scott Shaw	Respond to of 753

Energas Resources V.EEG PRESS RELEASE . . . . Natural Gas Property July 7, 1998 Energas Resources Inc. (the "Company") is pleased to announce that its wholly-owned subsidiary, AT Gas Gathering Systems, Inc., an Oklahoma corporation ("AT Gas"), has entered into two agreements (the "Acquisition Agreements"), both dated as of July 7, 1998, pursuant in which AT Gas will acquire a major natural gas property with current represented production of 1.5 million cubic feet of gas per day from 25 wells. The property, which comprises 42 wells (17 of which are currently not producing), over approximately 14,000 gross acres and comes with a pipeline gathering system extending 30 miles, is located in Haskell County, Oklahoma. The property is known locally as the "Roye Natural Gas Property". AT Gas has paid a US $100,000 deposit on account of the total purchase price of US $18,000,000. On closing, which is scheduled to be effective November 1, 1998, AT Gas will pay the vendors, both of whom are at arm's length to the Company, US $2.9 million on account of the total purchase price. Further payments of US $3,000,000 and US $12,000,000 are due one year and two years, respectively, after closing. On closing all interest of the vendors in the property would vest in AT Gas, subject to divestiture should the remaining payments not be made. Closing of the transaction is subject to, among other things, satisfactory completion of a due diligence review of the property and acceptance of the transaction by the Vancouver Stock Exchange. The Company has agreed to sell a 20% working interest in the property to an arm's length industry partner. The proceeds from such sale, which would amount to US $3.6 million, will be used to fund the US $2.9 million due on closing under the Acquisition Agreements. Completion of the written agreement relating to the sale to the industry partner is expected on or before July 15, 1998. Further announcements will be forthcoming. Based on an interim independent geologist's report submitted to the Company and the Company's own review of the property, the Company expects, although there can be no assurance, that production from the property can be significantly increased. The payments of US $3,000,000 and US $12,000,000 due one year and two years after closing are at the option of AT Gas. Should such payments not be made, the property would revert to the vendors without any further liability of AT Gas. David Young, the Chief Financial Officer of the Company, said "The acquisition of the Roye Natural Gas Property is the most exciting development in the history of our company. Management believes this transaction will be the catalyst for the company to make other acquisitions in today's marketplace. This project provides a solid base to propel the long-term growth of Energas Resources." THE VANCOUVER STOCK EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE. FOR FURTHER INFORMATION, CONTACT SCOTT SHAW, 1-800-365-6201.