Black Dragon Announces Short Selling Concerns.

AUSTIN, Texas -- Black Dragon Resource Companies, Inc. (Pink Sheets:BDGR) President Richard Michael stated, "As we announced earlier, Black Dragon Resource Companies, Inc. is becoming one of the largest producers of crude oil in our area in our first year of operations. We are growing steadily with our currently held properties and will make some leaps through acquisitions in process and new drilling.

In spite of these accomplishments I am dismayed, as are many of you, with our share price. The company has steadily conducted our business according to our plan. Production has increased every month. We are continuing to add production every month out of current cash flow. We are profitable. Yet our share price remains below $.40."

There are 7.6 million shares in the DTC, which are free trading shares. The depository Trust Company shows little movement of these shares even though there are several hundred thousand supposedly traded each day.

Management has spoken directly to several persons who have large positions in the stock and can discover none who are selling at these prices. They have concluded that there is a significant short position in our stock.

The Company is concerned that as we continue to grow and expand our asset base that the company will become a takeover target due the current undervaluation of our shares. We are in negotiations for credit and acquisitions and are confident that these negotiations will come to fruitful conclusions. Should that take place the possibility of a takeover attempt will increase.

If there is a significant short position, shareholders who have their holdings in street name accounts, with the shares held by CEDE & Co., may have difficulty establishing their ownership to fulfill a tender offer. Therefore Management recommends that shareholders demand delivery of their shares and take those shares in certificate form. This is the only way of guaranteeing your position as good news continues to come from the company.

Management at Black Dragon has worked hard this past year to create a valuable company for our shareholders (we are all part of that constituency). We want our loyal investors to benefit from those efforts and believe this advice is consistent with those desires.

Forward-Looking Statements 

Certain information discussed in this press release may constitute forward-looking statements within the Private Securities Litigation Reform Act of 1995 and the federal securities laws. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions at the time made, it can give no assurance that its expectations will be achieved. Readers are cautioned not to place undue reliance on these forward-looking statements. Forward-looking statements are inherently subject to unpredictable and unanticipated risks, trends and uncertainties such as the Company's inability to accurately forecast its operating results; the Company's potential inability to achieve profitability or generate positive cash flow; the availability of financing; and other risks associated with the Company's business. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.