PetroBakken Energy Ltd.

PetroBakken Energy Ltd.
Berens Energy Ltd.

February 25, 2010 17:55 ET

PetroBakken Completes Acquisition of Berens

CALGARY, ALBERTA--(Marketwire - Feb. 25, 2010) - PetroBakken Energy Ltd. ("PetroBakken" or the "Company") (TSX:PBN) and Berens Energy Ltd. ("Berens") (TSX:BEN) are pleased to announce the closing of the previously announced acquisition of Berens by PetroBakken. The acquisition of Berens was completed by way of amalgamation ("Amalgamation") pursuant to an amalgamation agreement entered into on January 4, 2010 among Berens, PetroBakken and PetroBakken Acquisition Ltd. (a wholly-owned subsidiary of PetroBakken). Pursuant to the Amalgamation, each holder of a Berens share received one fully paid and non-assessable class A non-voting redeemable preferred share in the amalgamated company for each Berens share held, and that preferred share was immediately redeemed in exchange for a cash payment of $2.70 per share (the "Transaction"). The Transaction, including Berens' indebtedness of approximately $72 million, is valued at approximately $343 million.

The Transaction was approved at the special meeting of Berens shareholders held on February 24, 2010, with 99.99% of the votes cast by the Berens shareholders present at the meeting in person or by proxy voting in favour of the special resolution to approve the Transaction. Berens shareholders must submit the Letter of Transmittal that accompanied the Berens' Information Circular and Proxy Statement dated January 20, 2010 to Olympia Trust Company, together with their Berens share certificates, in order to receive the cash payment. A copy of the Letter of Transmittal can be downloaded from SEDAR at An application will be made to delist the Berens shares from the Toronto Stock Exchange.

The Transaction

The Transaction is viewed as strategic by PetroBakken as it provides the Company with access to over 70 gross (40 net) sections of land that are prospective for Cardium light oil in the west Pembina fairway. The acquisition is consistent with PetroBakken's plans to increase exposure to high netback, light oil, resource plays. The acquisition of Berens adds to PetroBakken's land position in the Cardium play, providing PetroBakken with more than of 100 net potential Cardium locations.

PetroBakken funded the Transaction through existing credit facilities, which were undrawn following the Company's US$750 million convertible debenture issue completed in January 2010.

Key Attributes of the Transaction

- More than 11 mmboe of proved plus probable reserves with significant future reserve growth potential through revisions, additions, improved recoveries and the application of technology (none of the recent Cardium locations have been included in the reserve evaluations to-date);

- 2009 exit production of 3,650 boepd;

- Proved plus probable reserve life index of more than eight years based on the existing reserve report;

- Land position of 70 gross (40 net) sections that are prospective for the Cardium;

- More than 100 net potential Cardium locations; and

- Approximately $120 million of tax pools.

The acquisition of Berens, combined with the pending acquisition of Result Energy Inc. (announced January 28, 2010), will give the Company a significant Cardium land position, with over 150 net sections of land and more than 400 net potential drilling locations. PetroBakken will be applying an extensive technical and operational experience base to the Cardium resource play, gained through the drilling and completion of more than 500 horizontal wells with multi-stage fracture stimulations in the Bakken and other similar plays.

PetroBakken Energy Ltd. is a premier light oil production company combining, high growth, long-life Bakken reserves and production with legacy conventional light oil assets, delivering industry leading operating netbacks, strong cash flows and production growth. PetroBakken has a multi-year inventory of Bakken and light oil development locations, along with significant future development opportunities in the Horn River and Montney gas resource plays in northeast BC and the Cardium in Alberta. Our strategy is to deliver accretive production and reserves growth, along with an attractive dividend yield.

Berens Energy Ltd. is a junior oil and gas company currently trading on the Toronto Stock Exchange. Berens currently produces and explores for oil and gas in the Western Canadian Sedimentary Basin with its primary growth areas focused in the Pembina region. The Company's strategy is to focus on profitable growth through a strategic combination of investments in exploration, development and acquisitions in western Canada.

Forward-Looking Statements. Certain information provided in this press release constitutes forward-looking statements. The words "anticipate", "expect", "project", "estimate", "forecast" and similar expressions are intended to identify such forward-looking statements. Specifically, this press release contains forward-looking statements relating to potential reserves, production, and drilling locations. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be incorrect. Actual results achieved during the forecast period will vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors. You can find a discussion of those risks and uncertainties in our Canadian securities filings. Such factors include, but are not limited to: general economic, market and business conditions; fluctuations in oil prices; the results of exploration and development drilling; recompletions and related activities; timing and rig availability, the uncertainty of reserve estimates; changes in environmental and other regulations; risks associated with oil and gas operations; and other factors, many of which are beyond the control of the Company. There is no representation by PetroBakken that actual results achieved during the forecast period will be the same in whole or in part as those forecast. Except as may be required by applicable securities laws, PetroBakken assumes no obligation to publicly update or revise any forward-looking statements made herein or otherwise, whether as a result of new information, future events or otherwise.

BOE disclosure provided herein in respect of boes may be misleading, particularly if used in isolation. A boe conversion ratio of 6 mcf:1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent an economic value at the wellhead.

Contact Information

  • PetroBakken Energy Ltd.
    John D. Wright
    Chairman of the Board and Chief Executive Officer
    (403) 750-4400
    PetroBakken Energy Ltd.
    R. Gregg Smith
    President and Chief Operating Officer
    (403) 750-4400
    PetroBakken Energy Ltd.
    Corey C. Ruttan
    Executive Vice President and Chief Financial Officer
    and Director
    (403) 750-4400
    PetroBakken Energy Ltd.
    Peter D. Scott
    Vice President, Finance
    (403) 750-4400
    PetroBakken Energy Ltd.
    Bill A. Kanters
    Vice President Business Development and Corporate Planning
    (403) 750-4400