Emerge Oil & Gas Inc.
TSX : EME

June 21, 2010 13:41 ET

Emerge Announces Closing of Previously Announced Acquisition of Ear Lake and Reward Area Assets

CALGARY, ALBERTA--(Marketwire - June 21, 2010) - Emerge Oil & Gas Inc. ("Emerge" or the "Company") (TSX:EME) is pleased to announce that it has completed its previously announced acquisition of certain assets in the Reward and Ear Lake areas of Saskatchewan (the "Acquisition"), as previously detailed in its news release dated June 7, 2010. Highlights include:

  Estimated current production: 400 boe/d (86% 12o-14o API heavy oil, 14% natural gas)
  Proved plus probable reserves1: 550 mboe
  Proved plus probable RLI1: 3.8 years
  Well reactivation candidates: Approximately 80
  Drilling inventory: 25-52 locations
  Undeveloped land: 15,400 net acres
  Nearly 100% working interest-owned and operated  

1preliminary internal estimate

The consideration paid by Emerge was $9.9 million after closing adjustments, and was funded using the Company's existing credit facilities. In connection with the closing of the Acquisition, the Company's credit facilities have been increased from $50.0 million to $52.5 million.

Additionally, the Company has commenced drilling activity with two drilling rigs following an extended break-up and wet spring in the Lloydminster area.

About Emerge Oil & Gas Inc.

Emerge is engaged in the exploration for and development and production of oil and natural gas in Western Canada. The Company currently operates within two principal areas, namely, the Lloydminster area of West-Central Saskatchewan and East-Central Alberta and the Battlebend area of East-Central Alberta. Emerge is headquartered in Calgary, Canada. 

Barrel of Oil Equivalent

The Company may present petroleum and natural gas production and reserve volumes in barrel of oil equivalent ("boe") amounts. For purposes of computing such units, a conversion rate of 6,000 cubic feet of natural gas to one barrel of oil equivalent (6:1) is used. The conversion ratio of 6:1 is based on an energy equivalency conversion method which is primarily applicable at the burner tip and does not represent value equivalence at the wellhead. Readers are cautioned that boe figures may be misleading, particularly if used in isolation.

Forward-Looking Statements

Certain statements contained in this news release constitute "forward-looking statements" under applicable securities laws. These statements relate to future events or future performance and are based on the Company's current expectations, estimates, projections, assumptions and beliefs. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Accordingly, undue reliance should not be placed on these forward-looking statements. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking statements. All such forward-looking statements involve known and unknown risks and uncertainties, certain of which are beyond the control of the Company. Such risks and uncertainties include, without limitation: risks associated with oil and natural gas exploration, development, exploitation, production, transportation and marketing; general economic conditions in North America and globally; changes in the demand for Emerge's products; volatility in market prices for oil and gas, and in particular heavy oil; unanticipated fluctuations or declines in production; the effects of adverse weather conditions; changes in foreign currency exchange and interest rates; changes in tax or environmental laws, royalty rates or other regulatory matters affecting the Company and its operations; inaccurate estimation of Emerge's oil and natural gas reserves; ability to attract and retain qualified personnel; increased debt levels or debt service requirements; limited, unfavorable or lack of access to capital markets; and the impact of competitors. The forward-looking statements contained in this news release are made as of the date hereof and the Company does not intend, and does not assume any obligation, to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable securities laws.

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