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LOCAL EXPLORER HEADS FOR TEXAS AND FINDS GAS

Sydney - Thursday - April 10: (RWE Aust Business News)
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OVERVIEW
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A local exploration company specifically floated to search for
energy in Texas and parts of California has made a significant gas
strike.
The company, Modena Resources Ltd (ASX:MDA) on Tuesday reported
to the ASX that the Manzano well in Kleberg County (ST Tract 991 #1)
produced a strong gas flow.
The Manzano Shallow well, which spudded on February 2, has
successfully flowed gas and has been brought into immediate production.
The well has been tied directly into the sales grid and is
presently producing at a rate of 3.1 million cubic feet per day of gas as
well as some condensate from a perforated 6 ft interval.
Water production of around 190 bbls per day is believed to be
from a deeper zone and due to a fault in the casing cement.
Once the rig is finished with drilling the development well the
current producing well will be cement squeezed and re-perforated to cure
the water production.
Seismic interpretation and correlation with other wells in the
area suggest that this reservoir may be part of a single large
accumulation covering an area of more than 1,000 acres.
This interpretation will be tested by the drilling of a
development well which it is anticipated will commence within the next
few days.
Following the success of Manzano Shallow the Operator, BNP
Petroleum Corporation, has proposed the drilling of a follow-up
development well to be spudded immediately in order to significantly
reduce mobilisation and demobilisation costs.
Modena has agreed to participate in the drilling of this well at
its 12.5 per cent working interest.
Following the successful drilling and completion of Manzano
Shallow the estimated drilling costs of a follow-up development well are
$US301,250 net share to Modena.
In the previous month, Modena Resources announced it will drill
three gas prospects - Sandy, Slazenger and Wagner - in Jackson County,
Texas.
Modena has entered into a participation agreement to acquire an
undivided 60 per cent of 87.5 per cent of Seisgen's leasehold estate
and working interest in and to the lands and leases covering the above
mentioned shallow gas prospects located in Jackson County with Seisgen
retaining a 7.5 per cent carried working interest.
Simultaneous with Modena entering into the agreement, Seisgen
is selling to Paul Black of BNP Petroleum an undivided 40 per cent of
87.5 per cent over the same shallow gas prospects, with Seisgen
retaining a 5 per cent carried working interest.
BNP Petroleum will be the Operator for the drilling campaign.
Modena is paying 60 per cent of $US327,839 to Seisgen which
constitutes Seisgen's proportion of the cost of seismic, geophysical,
acreage, lease, legal and administrative overhead costs associated with
the properties which were incurred prior to the date of the agreement.
Modena will also pay 60 per cent of all cost associated with the
drilling (as defined) of all three test wells.
Thereafter, Modena is responsible for 52.5 per cent of all costs.
The contract depths are for shallow wells between 3,300 feet and
4,400 feet.
For the Sandy prospect 3,300 feet to test the Miocene Catahoula
formation.
The Slazenger prospect will test the Frio Miocene formation
seismic amplitude anomaly and the Wagner prospect will target 4,400 feet
to test the Frio formation seismic amplitude anomaly.

SHARE MARKET MOVEMENTS
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Shares of Modena Resources edged up 1c to 40.5c yesterday.
Rolling high for the year is 48c and low 23.5. The company has 44.2
million shares on issue with a market cap of $179 million.
In February, Modena Resources reported on the progress of the
Tobin Armstrong #2 well.
BNP Petroleum and its partners have successfully drilled the
initial test well on the Armstrong Ranch project in Kennedy County with
the Patterson-UTI rig 21 to total depth.
The Tobin Armstrong #2 well was logged by Schlumberger and, based
upon the analysis by BNP, showed in excess of 100 feet of productive
sands in the well.
The company has a 25 per cent working interest in this first well
on a 1,477 acre lease.
It has a number of follow-up locations on the lease.
In December, Modena Resources reported it had farmed into an oil
and natural gas exploration venture in Iberia Parish, southern Louisiana.
The farm-in covers one prospect, Bullseye, with leases covering
1,700 net acres.
The Bullseye prospect is testing deeper untested fault blocks on
the crest of the Laurel Ridge field.
Laurel Ridge is a 'Turtle', or an inverted basin feature,
discovered in 1944 by Humble Oil (Exxon Mobil)
At Bullseye, the intention is to test two deeper geopressured
targets with one vertical well.
These have combined gross best estimate potential reserves
(previously described as "P50 potential reserves") of 12.5 million
barrels of liquids and 33 billion cubic feet of natural gas.
Golden Gate Petroleum acts as the Operator, having farmed-in to
this prospect on similar terms.

BACKGROUND - PROSPECTUS
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Modena Resources Ltd launched its prospectus last October with an
issue of 30 million shares at 20c a share to raise $6 million.
The company joined the Australian Securities Exchange on November
21.
Chairman Peter Hampshire told investors in the prospectus that
the company had acquired a 10 per cent working interest in each of the
South Lost Hills properties and the Wilson prospect.
Modena entered into an agreement with Kindee Oil and Gas LLC on
the Wilson prospect located on Padre Island, Texas, on the Gulf of Mexico
coast.
The region is a proven hydrocarbon producing area.
The Padre Island joint venture has drilling leases covering an
estimated area of 25,000 acres.
The PIJV has acquired and is interpreting 124,000 hectares of 3D
seismic data within the project area.
Modena has farmed in on a number of the leases in this area.
In-house estimates indicate potential recoverable gas volumes in
this first joint venture are likely to be between eight and 20 billion
cubic feet.
Experienced industry players Royal Dutch Shell Plc, Exxon Mobil
Corporation, El Paso Corporation, Woodside Petroleum Ltd, Houston Oil &
Gas, Santos Ltd and Sinnaker Exploration company have projects in the
vicinity of Padre Island.
The company also farmed into the South Lost Hill properties in
Kern County, California.
The acreage is situated just south and adjacent to the southern
limit of a major oil and gas producing area known as the South Lost Hills
field.
ENDS