Bronco Energy Ltd.

Bronco Energy Ltd.

May 19, 2006 15:12 ET

Bronco Closes Private Placement

CALGARY, ALBERTA--(CCNMatthews - May 19, 2006) - Bronco Energy Ltd. (TSX VENTURE:BCF) ("Bronco") is pleased to announce that it has completed its private placement for gross proceeds of $30,000,000. The offering was fully subscribed, and resulted in the issuance of 6,750,000 common shares of the Corporation at a price of $4.00 per share and 600,000 flow-through common shares at a price of $5.00 per share. All of the common shares and flow-through common shares issued under the private placement are subject to a four-month hold period in Canada, which will expire on September 20, 2006.

RBC Capital Markets acted as lead agent on the private placement. Blackmont Capital Inc. and Lightyear Capital Inc. comprised the balance of the syndicate of agents. As compensation for the services provided, the agents received an aggregate cash commission of $1,800,000, together with an aggregate of 367,500 agents' warrants, each agents' warrant being exercisable to acquire one common share at a price of $4.00 per share until May 19, 2008. As a result of the private placement, Bronco now has 18,693,867 common shares issued and outstanding, 903,825 of which are subject to escrow restrictions. The officers and certain other insiders of Bronco participated in the offering.

The net proceeds from this offering will be used to fund Bronco's exploration, development, and acquisition programs as well as for general corporate purposes.

Bronco Energy Ltd. trades on the TSX Venture Exchange under the symbol "BCF".

This news release contains forward-looking statements which involve known and unknown risks, delays and uncertainties not under Bronco's control which may cause actual results, performance or achievements of Bronco to be materially different from the results, performance or expectations implied by these forward-looking statements.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction. The securities offered have not and will not be registered under the United States Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirement.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Bronco Energy Ltd.
    Brian Alford
    President and Chief Executive Officer
    (403) 699-8383
    (403) 693-0038 (FAX)
    Bronco Energy Ltd.
    David Johnson
    Chief Financial Officer
    (403) 699-8383
    (403) 693-0038 (FAX)