Longbow Resources Inc.
TSX VENTURE : LBR

Longbow Resources Inc.

November 08, 2007 17:51 ET

Longbow Resources Inc, Forecasts Minimal Impact From Royalty Changes

CALGARY, ALBERTA--(Marketwire - Nov. 8, 2007) - Longbow Resources Inc. (TSX VENTURE:LBR) ("Longbow" or the "Company") reports that following an evaluation of the Alberta government's proposed changes to its oil and gas royalty structure, Longbow says it has determined that the impact, of such changes on its cash flow and current drilling opportunities would be minimal.

This minimal impact is due to Longbow's substantial freehold lands, which are not affected by the government's proposed changes. Using publicly available information, Longbow estimates that, based on current production, the potential impact of the proposed royalty changes will not be material to the operations of the Company.

The Company's current production is now 70% oil and 30% natural gas with oil production primarily coming from our 100% Byemoor oil property.

Byemoor Update: 100% owned and operated.

Longbow reports that the next four wells to be drilled on its Byemoor oil property are all on freehold lands, with an average royalty of approximately 25%, thus providing Longbow with the flexibility to continue to allocate capital to these lands which are not directly affected by the proposed changes to the provincial royalties. The Byemoor property is split approximately 50% freehold and 50% Crown lands. The estimated incremental percentage in royalties on the Crown lands is about 2.5% based on the current production and an oil price of $75 CDN per barrel.

The first new horizontal well on the Byemoor property spudded on October 31st and is scheduled to reach total depth by this Sunday, the 12th of November. This well is expected to be on production by year end.

Phase one of the workover and stimulation program on the existing producing wells has also now been completed on five wells in the field. All five wells are showing increased production, with rates to be announced after flush production stabilizes.

Lone Pine Creek Update: 100%

The Lone Pine prospect features two stacked zones targeting potential ultimate recovery in the 4 to 8 BCF range per zone. Three analogous wells in the surrounding area averaged over 800 boepd in their first year of production. The Company has completed surveying the surface location and has now finished the public consultation and notification process. The well license has been issued by the EUB and the Company is awaiting Emergency Response Plan (ERP) approval. Longbow expects to have the well spudded by late November early December. The Lone Pine prospect is comprised of 75% freehold and 25% Crown lands. The effect of the proposed royalty changes translates into an approximate increase in the combined royalty on the property of 2%, which increases the total current royalty from 24% to 26%.

Certain statements contained herein may constitute forward-looking statements. These statements relate to future events or our future performance. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe" and similar expressions. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. We believe that the expectations reflected in the forward-looking statements are reasonable based upon management's current views but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. No assurance can be given that actual results, performance or achievement expressed in, or implied by these forward-looking statements will occur, or if they do, that any benefits may be derived from them. Past results have been applied in drawing a conclusion or making a forecast or projection set out in the forward-looking information. The term barrels of oil equivalent ("boe") may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet per barrel (6mcf/bbl) of natural gas to barrels of oil equivalence is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. All boe conversions herein are derived from converting gas to oil in the ratio mix of six thousand cubic feet of gas to one barrel of oil.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this press release.

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