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Mesquite Resources - Corporate Update Flow-Through Financing.

CALGARY, ALBERTA--(BUSINESS WIRE)--Nov. 25, 1996-- Mesquite (Alberta Stock Exchange:MQT.) Mesquite Resources Inc. confirmed today that it will be holding its Special Shareholders Meeting on December 9, 1996 to approve the Company's Major Transaction.

Mesquite's Major Transaction is composed of four elements: (1) the acquisition of 100 percent of the shares of Dynasty Resources Ltd. in exchange for 1,000,000 Mesquite shares valued at $0.25 (2) the acquisition of 100 percent of the shares of Key West Oil and Gas Corporation in exchange for 1,500,000 Mesquite shares valued at $0.20. (3) the acquisition for $650,000 of a package of producing oil and gas properties in Alberta and Saskatchewan. (4) the Private Placement of 1,500,000 shares of Mesquite at $0.20 per share for proceeds of $300,000. The Major Transaction, once approved, will result in Mesquite having accumulated production of 105 BOEPD, 438,660 BOE of reserves, interests in 4007 net acres, 9500 kilometers of seismic data and ownership of certain marketable securities. Specific details of the transaction, together with engineering and financial disclosure were contained in the Company's Information Circular dated November 4, 1996.

Since concluding negotiations with Mesquite, Key West has purchased land in southern and central Alberta in two recent land sales and is currently participating (net 10 percent) in a tight-hole test in the Leduc area. Key West's activities are being pursued in its normal course of business.

Mesquite also announced its plans to complete a private placement of 1,000,000 shares at $0.45 per share for proceeds of $450,000 to Mesquite. The funds are being raised pursuant to a flow-through share arrangement and will be expended on qualified Canadian Development and Canadian Exploration Expenses. -0-

The Alberta Stock Exchange has neither approved nor disapproved the contents of this press release.

CONTACT: Mesquite Resources Inc.

Steve Takacs, 403/269-8924
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Publication:Business Wire
Date:Nov 25, 1996
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