Goldnev Announces Commencement of Re-entry Operations at Turner Valley

Jun 25, 2010, 10:43 ET from Goldnev Resources Inc.

CALGARY, June 25 /PRNewswire-FirstCall/ - Goldnev Resources Inc. ("Goldnev" or the "Corporation") (TSXV: GNZ) is pleased to report today that a service rig to be used for the re-entry of the 13-21-20-3WM oil well on the Corporation's 50.4 percent owned Turner Valley property has arrived on location and commenced the re-entry operations as previously described in its new release of May 12, 2010.

Re-entry Operations

The service rig is operating on a 24 hours basis utilizing two crews supplied by Nabors Industries Ltd. working twelve hour shifts. The work program includes the recovery of several metal bands previously dropped in the hole above a hydraulic packer, chemically cutting the tubing in the horizontal section of the well, latching onto the hydraulic packer and pulling of the existing packer and tubing string assembly out of hole in order that a new packer and electric submersible pump ("ESP") and tubing string be installed and the well production tested. The re-entry operations are expected to take another several days to complete and production flow testing of the well is expected to begin on or before June 30, 2010.

To date the company has previously cleaned out and successfully pressure tested a 4.3 kilometer four inch pipeline that is market connected to an oil and gas processing facility that is owned and operated by Devon Canada Inc. The pipeline is now certified and approved to receive production fluids and natural gas from the 13-21-20-3WM oil well.

The service rig operations have using a magnet attached to a coil tubing unit recovered 14 steel ESP bands located on or above the hydraulic packer and have successfully latched onto the hydraulic packer and tubing assembly. The service rig is currently conducting operations to chemically cut the tubing string in the horizontal leg of the well and over the next several days is expected to pull the packer and tubing string assembly out of the hole.

Once the service rig operations to re-enter the well are completed the Corporation plans on production testing the well for a period of several days and if the project is successful is expected to result in restricting the inflow of produced water and immediate production and sales volumes of between 100 - 200 gross barrels of light oil production.

Geological Setting

The Corporation's Turner Valley lands are located adjacent to and west of the historic main Turner Valley Rundle Pool and are located over an unexploited oil accumulation called the KEW structure which is a faulted out slice of the Turner Valley oil field fault system, believed to have been at one time part of the same structure as the producing Turner Valley field.

To date four oil wells have been drilled and encountered oil in the Rundle formation on the KEW structure, which has an area of closure of more than eleven sections. In 1998 Shell Canada drilled a horizontal well on the Corporation's acquired lands from the surface location at 31-21-20-3W5M. Upon completion and testing the well initially flowed at 600 STB/d, but soon afterwards water encroached through a major fault that the horizontal leg intersected. A conventional packer system was run in the horizontal leg but failed to stop the inflow of water, however the well continued to produce at a rate in the range of 70 STB/d and 300 bbls of water for a period of almost three years. The well was shut-in due to downhole equipment failure during a period of low oil prices at which time the cost of remedial action was not justified.

A series of shallower Mannville and Jurassic sands (the "Blairmore"), which are natural gas bearing in the area, represent a secondary opportunity. Talisman drilled and re-completed approximately 30 such natural gas wells just south in the same field as the company's lands all of which are producing gas wells.

Analog Study of the Turner Valley Area

A detailed study of Turner Valley Rundle field which has been producing since the 1940's indicated that the average recovery to date from a one section area is 5.7 million STB.

The analog study on approximately 30 Talisman Blairmore wells indicates about 2000 MMscf per well recovery for the Blairmore natural gas zones.

    About Goldnev
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Goldnev Resources Inc. is a public energy company focused on the exploration and development of conventional and unconventional hydrocarbons in northeastern British Columbia, southwestern Alberta and east central Saskatchewan. Goldnev shares trade on the TSX Venture Exchange under the symbol "GNZ."

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Forward Looking Statements

This Company Press Release may contain certain "forward-looking" statements and information relating to the Company that are based on the beliefs of the Company's management as well as assumptions made by and information currently available to the Company's management. Such statements reflect the current risks, uncertainties and assumptions related to certain factors including, without limitations, competitive factors, general economic conditions, customer relations, relationships with vendors and strategic partners, the interest rate environment, governmental regulation and supervision, seasonality, technological change, changes in industry practices, and one-time events. Should any one or more of these risks or uncertainties materialize, or should any underlying assumptions prove incorrect, actual results may vary materially from those described herein.

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.

SOURCE Goldnev Resources Inc.