September 27, 2007 - 8:35 AM EST
Canary Resources Begins Commercial Production of Coal-Bed Methane Gas Into Southern Star Central Gas Pipeline
Canary Resources Inc. (PINKSHEETS: CYRR) ("Canary") announces that it has commenced commercial gas production from ten wells in the Eastern Forest City Basin of Kansas and Missouri. Canary holds a 100% working interest in two of the wells, and a 50% working interest in eight wells which are part of an agreement announced in May 2007 with K C Clean Energy LLC. Canary operates all ten wells. The wells are connected to Canary's wholly owned interconnect into the 20 inch Southern Star Central Gas Pipeline.
Canary is presently adding infrastructure to connect several additional completed gas wells, presently shut-in pending connection to Canary Pipeline, Inc's collection system, in the immediate vicinity of the interconnect. Sample analyses confirmed Canary's gas is of pipeline quality, allowing gas flows into the Southern Star Central Gas Pipeline to commence.
Initial indications from the ten wells show commercial flow rates that exceed expectations. Canary will monitor and adjust the computerized pump control systems to maximize stream levels to produce gas and water at optimal efficiency. Drilling, completion and hook-up of additional wells are underway, which will permit Canary to start realizing gas revenues along with transportation fees from wholly owned Canary Pipeline, Inc. Canary expects continuous commercial sales of coal-bed methane gas now that production has commenced.
Canary Resources Inc. is independent Oil and Natural Gas Company engaged in the acquisition, exploitation, production and development of oil and natural gas properties in Johnson and Miami Counties, Kansas, and in Bates and Cass Counties, Missouri, for which it is the operator.
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