Petrobank Energy and Resources Ltd.
TSX : PBG

Petrobank Energy and Resources Ltd.

November 21, 2008 13:51 ET

Petrobank Enters Into THAI™ Royalty and Technology Licence and Joint Venture Agreement

CALGARY, ALBERTA--(Marketwire - Nov. 21, 2008) - Petrobank Energy and Resources Ltd. ("Petrobank" or the "Company") (TSX:PBG) is pleased to announce that it has entered into a royalty and technology license and a joint venture agreement (the "Agreement") with True Energy Trust ("True") to apply Petrobank's patented THAI™ heavy oil recovery technology on portions of True's Kerrobert heavy oil property in Saskatchewan.

Under the Agreement, Petrobank will initially earn a 50% working interest in three sections of land in the Kerrobert Mannville heavy oil pool. Subject to regulatory approval, Petrobank and True will develop a two well project to demonstrate the THAI™ technology in the 10+ metre thick Mannville conventional heavy oil channel reservoir. Petrobank will earn an additional ten percent gross overriding technology royalty on True's share of all THAI™ production following a threshold reserve recovery.

Petrobank is also entitled to earn a 50% working interest in ten additional sections of True lands upon the expansion of the initial THAI™ project or development of another project on these lands, which Petrobank and True would develop jointly. In addition, Petrobank and True have established an area of mutual interest over thirty additional sections of land to jointly develop additional THAI™ projects.

Petrobank is excited about the opportunity to partner with True and bring the THAI™ technology to the conventional heavy oil resource base in Saskatchewan. Saskatchewan has billions of barrels of unrecovered heavy oil that could be efficiently captured using our THAI™ technology. This is Petrobank's second license agreement that expands our THAI™ technology into conventional heavy oil reservoirs and into a jurisdiction in Saskatchewan that is proactive in encouraging project development and facilitating the application of advanced technologies. Our project engineering and design has been advancing rapidly with respect to this project and, based on preliminary discussions with Saskatchewan government officials, we expect to have a prompt approval of this initial project and future projects in the Province.

"This is indeed a welcome announcement, particularly in these uncertain economic times, and a vote of confidence in the future of Saskatchewan's energy sector," Saskatchewan Premier Brad Wall said. "I congratulate the team at Petrobank for moving ahead with this innovative technology that promises development of Saskatchewan's conventional heavy oil resources in an environmentally responsible and sustainable way."

Petrobank Energy and Resources Ltd.

Petrobank Energy and Resources Ltd. is a Calgary-based oil and natural gas exploration and production company with operations in western Canada and Colombia. The Company operates high-impact projects through three business units and a technology subsidiary. The Canadian Business Unit is focused on developing a solid production platform from the Bakken light oil play in southeast Saskatchewan, and exploiting a large undeveloped land base through the application of new technology to large oil and gas resource opportunities. The Latin American Business Unit, operated by Petrobank's 76.4% owned TSX-listed subsidiary, Petrominerales Ltd. (trading symbol: PMG), is a Latin American-based exploration and production company producing oil from three blocks in Colombia and has contracts on 14 exploration blocks covering a total of 1.6 million acres in the Llanos and Putumayo Basins. Whitesands Insitu Partnership, a partnership between Petrobank and its wholly-owned subsidiary Whitesands Insitu Inc., owns 75 net sections of oil sands leases in Alberta, 36 sections of oil sands licenses in Saskatchewan and operates the Whitesands project which is field-demonstrating Petrobank's patented THAI™ heavy oil recovery process. THAI™ is an evolutionary in-situ combustion technology for the recovery of bitumen and heavy oil that integrates existing proven technologies and provides the opportunity to create a step change in the development of heavy oil resources globally. THAI™ and CAPRI™ are registered trademarks of Archon Technologies Ltd., a wholly-owned subsidiary of Petrobank.

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. 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, outcome of exploration contract negotiations; fluctuation in foreign currency exchange rates; 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 Petrobank 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, Petrobank 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.

Contact Information

  • Petrobank Energy and Resources Ltd.
    John D. Wright
    President and Chief Executive Officer
    (403) 750-4400
    or
    Petrobank Energy and Resources Ltd.
    Chris J. Bloomer
    Senior Vice President and Chief Operating Officer, Heavy Oil
    (403) 750-4400
    or
    Petrobank Energy and Resources Ltd.
    Corey C. Ruttan
    Senior Vice President and Chief Financial Officer
    (403) 750-4400
    or
    Petrobank Energy and Resources Ltd.
    R. Gregg Smith
    Senior Vice President and Chief Operating Officer, Canada
    (403) 750-4400
    Email: ir@petrobank.com
    Website: www.petrobank.com