MARCELLUS SHALE PROJECT,

APPALACHIAN BASIN, PENNSYLVANIA

Operator:

Running Foxes Petroleum Inc. – 50%  

Osceola – 50%

This project has evolved from Revloc where some Devonian Marcellus Shale intersections in Osceola/Admiral Bay CBM wells were found to be organically rich and excellent candidates for shale gas production.  Our Revloc partner, Admiral Bay, elected not to develop the shale gas and so Running Foxes Petroleum joined forces with Osceola and assumed operation of this project.

The Marcellus Shale is at the early stages of exploitation as a significant gas resource in this part of the Appalachian Basin. 

The partnership is currently building a land bank position.  Some 6,000 acres are currently leased.  The shale extends from New York State in the north east, south west through Pennsylvania and into north west West Virginia and eastern Ohio.  Total organic carbon (TOC) values, a measure of hydrocarbon source richness, are highest over the north and east of this trend.

Early entrants into the development of this new shale play are applying slick water fracture techniques to horizontal wells drilled parallel and orthogonal to the natural joint patterns developed within the shale.  These wells are successfully producing between 3.2 and 5.8 MMCFGPD (million cubic feet of gas per day).