Kroes Energy Inc.

Kroes Energy Inc.

November 01, 2007 18:28 ET

Kroes Energy Inc. Announces Shallow Gas Acquisition

CALGARY, ALBERTA--(Marketwire - Nov. 1, 2007) - Kroes Energy Inc. ("Kroes" or "the Company"), (TSX VENTURE:KRS) announced today that on November 1, 2007 it acquired a 25% interest in a five section Viking gas development project from the same private Alberta company which operates the shallow gas exploration program in central Alberta that Kroes entered into last year.

The new gas development project has four wells capable of production, one of which is currently producing approximately 150,000 cubic feet per day (Kroes' share 37,500 cubic feet per day). The other wells will be brought on-stream in 2008 after compression and pipeline facilities have been installed. There are at least four additional prospective drilling locations on these lands which the joint venture plans to drill in 2008. Total consideration paid for the lands, wells and existing natural gas reserves was $250,000.

Fred Callaway, President of Kroes said "This is another step in the evolution of the Company's western Canadian shallow gas program. We believe it will be a profitable addition to the other exploration/exploitation activity we have in the area."

The Company now has interests in seven producing gas wells, with Kroes' share of production being approximately 730 cubic feet per day (120 barrels of oil equivalent per day). In addition to the three shut-in Viking gas wells, Kroes also has a 25% interest in a Mannville well drilled earlier this year which should be on-stream before year end after completion of a pipeline connection.

BOE's may be misleading, particularly if used in isolation. A BOE conversion ratio of 6MCF:1Bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.


This disclosure contains certain forward-looking estimates that involve substantial known and unknown risks and uncertainties, certain of which are beyond Kroes' control, including: the impact of general economic conditions in the areas in which the Company operates, industry conditions, changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in commodity prices, foreign exchange or interest rates, stock market volatility and obtaining required approvals of regulatory authorities. In addition, there are risks and uncertainties associated with oil and gas operations; therefore, Kroes' actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking estimates and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking estimates will transpire or occur, or if any of them do so, what benefits, including the amounts of proceeds, that Kroes will derive from that.

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