Caribou Resources Corp.

Caribou Resources Corp.

January 17, 2007 14:29 ET

Caribou Resources Corp. Announces Closing of Disposition and Debt Facility

CALGARY, ALBERTA--(CCNMatthews - Jan. 17, 2007) - Caribou (TSX VENTURE:CBU) announces that it has closed the previously announced disposition of non operated assets (Caribou WI approximately 17%) in Northern Alberta for $5.6 million. Proceeds of the disposition were used to reduce bank debt.

The Company also announces that it has renewed and increased its existing credit facility with Brookfield Bridge Lending Fund through a non revolving demand credit facility for $28.0 million, which replaces the existing bank credit facility and is secured by first ranking security interests in respect of the assets of the Company. The facility matures on March 30, 2007. At the option of Caribou, an extension right to June 29, 2007 at no additional cost exists subject to the company raising additional proceeds that may come from the issuance of equity, the sale of assets or from some combination thereof.

Caribou is continuing to take the necessary steps to strengthen its balance sheet. The Company has also implemented a risk management program consisting of both fixed price contracts as well as costless collars which will help mitigate commodity price volatility. These contracts are described in detail in the Company's Q3 report. The contracts for 2007 cover 2,480 GJ/d of natural gas and 246 bbls/d of oil, as follows:

Natural Gas - 1,200 GJ/d Fixed November 2006 to October 31, 2007 at $7.14 GJ AECO

Natural Gas - 1,280 GJ/d Fixed January 1to December 31, 2007 at $7.70 GJ AECO

Oil - 123 bbls/d Fixed January 1, 2007 to December 31, 2007 at US $64.43/bbl WTI

Oil - 123 bbls/d Fixed January 1, 2007 to December 31, 2007 at US $64.80/bbl WTI

Caribou has current production of approximately 1,200 boe/d (net of dispositions) comprised of 40% oil and 60% gas and a balanced inventory of prospects in Northern and Central Alberta where it holds over 80% WI in approximately 190,000 net acres of undeveloped land and operates over 85% of its production. The Company has approximately $90 million in tax pools.

Certain information regarding Caribou in this news release including management's assessment of future plans and operations, production estimates, drilling inventory and wells to be drilled, timing of drilling and tie-in of wells, productive capacity of new wells, capital expenditures and the timing thereof, may constitute forward-looking statements under applicable securities laws and necessarily involve risks including, without limitation, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, inability to retain drilling rigs and other services, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources. As a consequence Caribou'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 events anticipated by the forward-looking statements will transpire or occur, or, if any of them do so, what benefits Caribou will derive therefrom. Readers are cautioned that the foregoing list of factors is not exhausted. Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release and Caribou does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws. The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Natural gas reserves and volumes are converted to barrels of oil equivalent (boe) on the basis of six thousand cubic feet (mcf) per one barrel (bbl) of oil. Boes may be misleading, particularly if used in isolation. The 6:1 boe conversion ratio is based upon an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Contact Information