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CALGARY, ALBERTA - Montello Resources Ltd (TSX Venture Exchange: MEO) is pleased to announce that it has entered into an LOI to sell a portion of its Pincher Creek assets to generate short term financing. Selling assets has been Montello's primary source of funding for the past 12 months due to the Company's inability to secure equity financing due to the economic climate and its inability to restructure due to shareholders voting against a stock consolidation plan at the Company's last Annual General Meeting.
The inability to raise capital in the public markets coupled with the process of thoroughly overhauling its financial reporting at a time when the company was under continuous disclosure review by the Alberta Securities Commission (ASC) led to the Company's inability to file its financial statements in a timely manner thus causing the ASC to issue the first of two cease trade orders in April 2009.
The lack of funds also made it difficult to hire sufficient financial personnel to manage the financial reporting obligations of the Company prior to the appointment of the current CFO. This led to a second cease trade order on January 29, 2010 as current management performed a complete review and revision of the Company's financials pulling together accounting records from various locations and developing a new financial reporting system.
In order to meet its current financial obligations, Montello has entered into a Letter of Intent with Tosca Capital Corp. ("Tosca") of Vancouver, British Columbia to sell a 5% working interest in its Pincher Creek Oil and Gas asset for $250,000. Tosca is the general manager of Pincher Creek Limited Liability Partnership of Vancouver, the entity which will receive the net income from the production of the 5% interest and make distributions to the limited partners. Within 12 months of the commencement of production, Tosca has the option to convert its interest to shares in Montello.
ON BEHALF OF THE BOARD OF DIRECTORS
"Peter C. Brown"
Peter C .Brown
President-CEO-Chairman
For further information about this announcement and about Montello, please contact Corporate Communications' Greg Tweed at info@montello.com. Prospective and current shareholders are invited to join the company's official investment forum at www.pinnacledigest.com/company/meo:ca The online forum allows for investor controlled discussion, questions, third party reports and articles, as well as feedback. Please go to http://www.sedar.com for a detailed list of all filings. Visit www.montello.com for ongoing updates & have your name included on our mailing list.
for a detailed list of all filings. Visit www.montello.com for ongoing updates & have your name included on our mailing list.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
About Montello
Management's goal is to pursue opportunities for high impact oil and gas exploration and recompletion projects in the Appalachian Basin in Tennessee as well as search for potential high impact exploration drilling opportunities back home in the Province of Alberta, Canada's oil and gas heartland.
Forward-Looking Information
This document may contain "forward-looking information" within the meaning of Canadian securities legislation and "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, "forward-looking statements"). These forward-looking statements are made as of the date of this document and Montello Resources Ltd. (the "Company") does not intend, and does not assume any obligation, to update these forward-looking statements, except as required under applicable securities legislation.
Forward-looking statements relate to future events or future performance and reflect Company management's expectations or beliefs regarding future events and include, but are not limited to, statements with respect to the estimation of mineral reserves and resources, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production, capital expenditures, success of mining operations, environmental risks, unanticipated reclamation expenses, title disputes or claims and limitations on insurance coverage. In certain cases, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved" or the negative of these terms or comparable terminology. By their very nature forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, risks related to actual results of current exploration activities; changes in project parameters as plans continue to be refined; future prices of resources; possible variations in ore reserves, grade or recovery rates; accidents, labour disputes and other risks of the mining industry; delay s in obtaining governmental approvals or financing or in the completion of development or construction activities; as well as those factors detailed from time to time in the Company's interim and annual financial statements and management's discussion and analysis of those statements, all of which are filed and available for review on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on forward looking statements
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