Canadian Phoenix Resources Corp.
TSX VENTURE : CPH

Canadian Phoenix Resources Corp.

November 19, 2008 21:37 ET

Canadian Phoenix Resources Corp.: Serrano Energy Ltd. Announces Private Placement Financing & Letter of Intent to Reduce Its Working Interest in Its Blackrod/Portage Oil Sands Property

CALGARY, ALBERTA--(Marketwire - Nov. 19, 2008) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

CANADIAN PHOENIX RESOURCES CORP. ("Canadian Phoenix") (TSX VENTURE:CPH) is pleased to announce that Serrano Energy Ltd. ("Serrano"), a subsidiary of Canadian Phoenix, has completed a private placement (the "Private Placement") of 1,400,000 Common Shares issued on a flow-through basis ("Flow-Through Shares") at a price of $5.00 per Flow-Through Share for gross proceeds of $7,000,000.

Serrano intends to use the proceeds from the Private Placement to fund exploration expenditures (qualifying as Canadian Exploration Expense under the Income Tax Act (Canada)) on Serrano's properties located in Alberta and Saskatchewan.

Serrano also announces that it has signed a letter of intent with Pearl Exploration and Production Ltd. ("Pearl") pursuant to which:

(a) Serrano will transfer to Pearl E&P Canada Ltd., a wholly-owned subsidiary of Pearl ("Pearl E&P"), 3/7ths of its interest (or a net 15% working interest) in its Blackrod oil sands leases located south of Fort McMurray, Alberta;

(b) The resulting working interests in the Blackrod project will be 20% for Serrano and 80% for Pearl (through its wholly-owned subsidiaries) and Serrano will transfer operatorship of the project to Pearl;

(c) Serrano will fund the next $6.25 million of gross expenditures on the Blackrod project, which expenditures will qualify as Canadian Exploration Expense under the Income Tax Act (Canada); and

(d) Pearl will transfer to Serrano all of its 4,037,344 common shares in the capital of Serrano for cancellation and the Pearl nominee will resign from the board of directors of Serrano.

The transaction with Pearl is subject to completion of definitive agreements and applicable regulatory approvals.

Earlier this year, Canadian Phoenix acquired 11,000,000 Common Shares of Serrano as part of a series of transactions. For further details please refer to the news release dated August 20th, 2008. Canadian Phoenix, prior to the completion of the Private Placement and the transactions with Pearl under the letter of intent, holds 50.2% of the issued and outstanding Common Shares of Serrano. Following the completion of the Private Placement and the transactions with Pearl, Canadian Phoenix will hold 56.5% of the issued and outstanding Common Shares of Serrano.

Serrano Energy Ltd. is an Alberta-based company formed to participate in heavy oil and natural gas exploration, development and acquisitions in Alberta and Saskatchewan. Serrano's shares are not currently listed for trading on any stock exchange. Following the Private Placement and the completion of the transactions with Pearl under the letter of intent, Serrano will have 19,457,389 Common Shares outstanding.

Canadian Phoenix Resources Corp. is a publicly-traded junior oil and gas exploration, development and production company with operations in Western Canada. Canadian Phoenix is pursuing a corporate strategy of being a consolidator of oil and gas assets located in the Western Canadian Sedimentary Basin. Strategic corporate acquisitions promote partnerships for the future development of acquired or targeted oil and gas assets. Canadian Phoenix's shares trade on the TSX Venture Exchange under the symbol "CPH".

ON BEHALF OF THE BOARD OF DIRECTORS OF CANADIAN PHOENIX RESOURCES CORP.

Thomas P. Stan, President & CEO

FORWARD-LOOKING STATEMENTS: Certain information set forth in this document, including management's assessment of Serrano's future plans and operations, contains forward-looking statements. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond these parties' control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and ability to access sufficient capital from internal and external sources. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. Serrano's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that Serrano will derive therefrom. Serrano disclaims any intention or obligation to update or review any forward-looking statements, whether as a result of new information, future events or otherwise.

The TSX Venture Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

Contact Information

  • Canadian Phoenix Resources Corp.
    Thomas P. Stan
    President & CEO
    (403) 920-0040
    (403) 920-0043 (FAX)