Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Mainland Resources, Inc. (MNLU.OB) Closes Sale of Shale Assets

Mainland Resources, Inc. closed on the sale of its assets in the Haynesville Shale in Louisiana to EXCO Resources (NYSE:XCO). The sale is effective as of January 1, 2010. The assets are located in the East Holly Field, in DeSoto Parish, Louisiana, and Mainland Resources, Inc. received $28.16 million cash in the sale.

Mainland Resources, Inc. said that the Haynesville Shale assets divested included the company’s 40% working interest in mineral rights at a depth lower than the base of the Cotton Valley Sand formation. The company kept a full interest in all formations above this base, including the Cotton Valley Sand, Hosston and Upper Bossier areas.

Mainland Resources, Inc. properties now include 2,745 acres in the East Holly Field that are prospective for the Cotton Valley Sand, Hosston and Upper Bossier areas. The company estimates that it has 65 drilling locations here, and will drill 3 wells in 2010.

Mainland Resources, Inc. also has properties in Jefferson County, Mississippi, where it has 17,000 acres in its inventory. The company has a 45.9% working interest here and plans to drill a horizontal well on the Buena Vista prospect in the third quarter of 2010.

Please see disclaimer on QualityStocks website:


Disclosure: NO POSITIONS