Exall Energy Corporation

Exall Energy Corporation

April 30, 2008 15:21 ET

CORRECTION FROM SOURCE: Exall Updates Operations and Reserves

CALGARY, ALBERTA--(Marketwire - April 30, 2008) - The following corrects and replaces the release sent on April 30, 2008 at 12:50 ET. The last 2 paragraphs were added which begins with a "Disclaimer".

Exall Energy Corporation ("Exall" or "the Company") (TSX:EE) is pleased to provide an update on operations and reserves:


- The Marten Mountain horizontal well produced at an average rate of 760 barrels of oil per day (BOPD) in the last two weeks of March; the well is now shut-in until after spring breakup.

- The Jayar horizontal well has been completed, multiple-fracture stimulated and is producing gas and fracture fluid (oil).

- Total Proven reserves at April 1, 2008 increased 66% to 666.4 thousand barrels of oil equivalent (MBOE) compared to 2007 year-end reserves and Proven and Probable increased 9% to 981.9 MBOE.

- Updated evaluation as at April 1, 2008 reports the value of total Proven reserves increased 202% to $20.9 million and proven and probable increased 65% to $29.6 million, compared to 2007 year-end reserves.

The Marten Mountain horizontal well initially produced 1,585 BOPD plus 575 thousand cubic feet of gas per day (MCFPD) during a 48 hour production test on completion of the well and produced at an average rate of 760 BOPD plus 150 MCFPD of gas, when placed in production through temporary facilities and restricted choke for the last two weeks of March. The well has been shut in during the spring break-up period. Construction of a permanent bridge to the site has been completed and road access will be finished after spring break-up, allowing the well to be put back on production in June.

An updated independent reserves evaluation of Marten Mountain has assigned 412.7 thousand stock tank barrels (MSTB) of Proven Developed Producing (272.4 MSTB net) and 556.4 MSTB Proven plus Probable (367.2 MSTB net) reserves to the well and a discounted net present value of $12.23 million Proven and $15.77 million Proven plus Probable to Exall's interest in the well (59.338% working interest BPO, converting to 66% working APO). The well will be restricted to the Energy Resources Conservation Board (ERCB) test allowable of 285 BOPD when placed back in production after Spring break-up and 142 BOPD after the remaining three-month test period. The company continues to pursue water injection and Good Production Practice (GPP) approval, which will allow higher production rates. Two additional development locations have been established by this well.

The Jayar horizontal well (14.5% Exall) has been completed and multiple-fracture stimulated. The well is currently flowing and producing gas to the sales line and recovering fracture fluid (oil). Stabilized flow rates will be released once the well has cleaned up and is producing live formation oil.

The Company has received an updated third-party reserves report prepared by AJM Petroleum Consultants, effective April 1, 2008. A comparison with previous years' reserves follows:

Total Proven
Reserves % NPV ($000) %
(MBOE) Increase @ 10% DCF Increase
Dec. 31, 2006 254.5 - $5,332 -
Dec. 31, 2007(i) 402.1 58% $6,942 30%
Apr. 1, 2008 666.4 66% $20,931 202%

Proven and Probable
Reserves % NPV ($000) %
(MBOE) Increase @ 10% DCF Increase
Dec. 31, 2006 432.3 - $8,314 -
Dec. 31, 2007(i) 902.1 109% $17,967 116%
Apr. 1, 2008 981.6 9% $29,644 65%

(i) 2007 includes the reserves of Kingsmere Exploration Ltd., which was
acquired on January 31, 2007

Exall Energy Corporation is a junior oil and gas company active in its business of oil and gas exploration, development and production from its properties in Alberta, British Columbia and Texas.

Exall currently has 38,604,927 shares issued and outstanding.

Disclaimer: NI 51-101/5.14(d) requires inclusion of a cautionary statement that: "BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead."

In addition, per NI 51-101/5.6 "the estimated values disclosed do not represent fair market value."

Contact Information

  • Exall Energy Corporation
    Frank S. Rebeyka
    President and CEO
    (403) 237-7820
    Website: www.exall.com