Mainland Resources, Inc. is developing an initial natural gas prospect located in northwestern Louisiana, USA. This prospect has been selected based on economics, low-risk to development, and on potential for immediate revenues through discovery of a significant natural gas structure.

NATURAL GAS – LOUISIANA

Recent developments by leading oil and gas companies in northwestern Louisiana have lead to a run on property in the region sending land values sky-rocketing from hundreds of dollars per acre to as much as $4,000 per acre. The excitement has been generated by several large discoveries in unconventional gas structures – specifically the Cotton Valley, Hosston, and most recently a major discovery by Chesapeake Energy (NYSE: CHK) in the Haynesville Shale.

Based on its geoscientific, petrophysical and engineering research during the past two years and the results of three horizontal and four vertical wells it has drilled, Chesapeake believes the Haynesville Shale play could potentially have a larger impact on the company than any other play in which it has participated to date. Chesapeake is currently utilizing four rigs to drill Haynesville Shale wells and plans to increase its drilling activity level to approximately 10 rigs by year-end 2008 and potentially more in 2009.

This structure, which is considered to occur through the De Soto Parish where Mainland’s leases are located, could extend as far as east Texas.

Initial reviews of the Haynesville Shale by leading analysts (including JP Morgan Chase) suggest that wells in the Haynesville Shale could conservatively produce from 3+ Bcefe to 5+ Bcfe per well. Based on these projections, it is believed that the net interest to Chesapeake alone in this play could top 3 Tcfe (source: JPMorgan).

EAST HOLLY FIELD, DE SOTO PARISH, LA

Mainland Resources, Inc. has been assembling a development block on the south side of the East Holly Field (currently includes almost six contiguous sections of mineral rights). Based on well bore petrophysical analysis, actual production tests, mud logging records and electric log analysis from wells located all around the lease block, any tests Mainland drills here should be productive in the Hosston, Cotton Valley and the Haynesville formations. Historically, recoverable gas volumes range from 2 Bcf to a high of 32 Bcf per section.

Other De Soto Parish area operators include Petrohawk Energy, El Paso Gas, Winchester Petroleum, Chesapeake Energy and Encana. All are actively drilling and acquiring new land positions in the area. Petrohawk recently completed a horizontal Cotton Valley well that tested 16.0 Mmcf/d. El Paso has recently a vertical Cotton Valley well that tested 2.3 Mmcf/d.

The initial wells drilled in these De Soto Parish field were all completed as Hosston gas wells. It was not until the late 90s that operators started to test the Cotton Valley. Whereas the Hosston zone is comprised of almost continuous sand packages totaling 1,500’ to 2,000’ that can be difficult to connect on a well-to-well basis, the Cotton Valley zone is comprised of three distinct sections and can be mapped individually from well to well.

Haynesville Shale

In addition to the Cotton Valley and Hosston formations, Mainland’s geological staff believes that the East Holly field holds significant potential for tight gas in the now emerging Haynesville Shale in the area. The area has been overwhelmed by major oil and gas companies, who have recently announced large discoveries in the Haynesville Shale that shares characteristics with the East Holly leases. Figure 1-2 demonstrates the detailed staking and land play underway.