Spitfire Energy Ltd.

Spitfire Energy Ltd.

January 04, 2005 12:33 ET

Spitfire Updates Activity


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: SPITFIRE ENERGY LTD.

TSX VENTURE SYMBOL: SEL

JANUARY 4, 2005 - 12:33 ET

Spitfire Updates Activity

CALGARY, ALBERTA--(CCNMatthews - Jan. 4, 2005) - Spitfire Energy Ltd.
(TSX VENTURE:SEL) ("SEL") announces that it has reached a three year
agreement with a private company wherein SEL has been granted access to
approximately 5,000 kilometers of seismic data in Alberta, including
drillable prospects and numerous leads, in exchange for a sliding scale
overriding royalty (max. 5%) on any lands SEL might acquire in the
prospect area. The owner of the data enjoyed greater than average
success in the drilling of more than 100 wells in the prospect area
before he retired 7 years ago and SEL, with his renewed involvement,
intends to continue where he left off. The owner has agreed to work with
SEL, as a geophysical advisor, in solidifying the locations on the data
adding significantly to the technical team.

At Alderson, SEL has completed a well (100% interest) as a gas well and
is currently proceeding to tie it into neighboring processing
facilities. SEL plans to frac the well to increase deliverability. SEL
plans to drill a third well on this prospect in the first quarter 2005.

At Fosterton, SEL has drilled and cased its fifth well since inception
(100% interest) as a potentially significant oil well. SEL will complete
and tie-in the well into its battery within the month. In December 2004,
SEL purchased a free water knock out and is expanding the capacity of
its battery to facilitate this new production and the production
anticipated from several recompletions it has planned in the pool.
Construction on the battery has commenced and will be completed in a few
weeks.

Spitfire continues to evaluate several other asset and corporate
acquisition opportunities and will only consider issuing new equity at
levels that give credit to the existing inventory of significant
opportunities being exploited.

Spitfire's shares trade on the TSX Venture Exchange under the symbol
"SEL".

When used in this news release, the words "anticipate," "estimate," and
similar expressions are intended to identify forward-looking statements.
Such statements are subject to certain risks, uncertainties and
assumptions that could cause actual results to differ materially from
those contemplated in the forward looking statements. These risks and
uncertainties include operating performance, regulatory and
environmental issues, weather and economic conditions, competition and
financing availability. For additional information on these and other
factors see the reports filed by SEL with Canadian securities
regulators. SEL disclaims any intention or obligation to update or
revise any forward-looking information whether as a result of new
information or future event.

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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Spitfire Energy Ltd.
    Keith N. Chase
    President and Chief Executive Officer
    (403) 205-3400 ext 224
    The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this release.