XXL Energy Corp.
TSX VENTURE : XL

XXL Energy Corp.

December 01, 2008 16:00 ET

XXL Energy Corp. Provides Update on Operations

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 1, 2008) - XXL Energy Corp. (the "Company" or "XXL") (TSV VENTURE:XL) provides an update on operations and other corporate matters.

Operational Update

Greater Green River Basin, Wyoming

During 2008, the Company participated in the drilling of six (6) wells in the Company's core Greater Jade Prospect Area, specifically the: Puckett Federal #1, Jade 7-10, Wynn Federal #1, Musial #1, Jackalope #1, and Stengal State #2 wells. Additionally, the Company participated in the drilling of one (1) well in the Eastern Greater Jade Project Area with the recent drilling of the NE Hay 10-33. Of the seven (7) wells in which the Company participated in 2008, four (4) are currently online and producing natural gas, while three (3) are awaiting completion.

The Musial #1 well (33.3% working interest ("WI") -- non-operated) was recently completed and flowed up casing immediately after the frac, into the line at over 1.75 million cubic feet of gas per day ("MMcf/d"). The Jackalope #1 well (33.3% WI -- non-operated) was also recently completed and flowed at 500 thousand cubic feet of gas per day ("Mcf/d"). The Company is awaiting completion activities on the Stengal State #2, which reached a total depth of 10,122 feet, and the previously announced (on February 8, 2008) Wynn Federal #1 well. XXL's management has recently elected to non-consent the completion of the NE Hay 10-33 (approximately 55% working interest -- non-operated) due to financial constraints faced by the Company as a result of currently unfavourable and turbulent capital markets. XXL's management team remains encouraged by the recent well results in the Greater Jade Prospect Area and expect these wells to significantly influence company-wide production as these wells come online.

The Company has an interest in over 17,000 net and contiguous acres in the Greater Jade Prospect Area where wells are currently being spaced on 160 and 80 acre spacing. The Company expects additional wells in the area to be drilled on 40 acre spacing as this area continues to be developed.

Columbia River Basin, Washington

Activity in the Columbia River Basin continues with a recent and significant transaction between Delta Petroleum Corporation and Husky Refining Company, announced September 29, 2008. XXL's management believes this transaction highlights the value of the Company's existing acreage position in the basin given the similarity of the acreage position acquired by the Independent. XXL's management continues to closely monitor drilling activity in the area and is evaluating the Company's top three (3) prospects. The Company is in discussion with its partners and other industry participants to further delineate future drilling plans.

The Company has an interest in over 200,000 net acres in the core area of the Columbia River Basin. The Company is closely monitoring the current drilling of a high-impact well being drilled by an industry participant in close proximity to some of the Company's acreage in the basin.

The Great Basin, Nevada

As a result of disappointing drilling results by other industry participants, the Company has exited the Great Basin of Nevada, where the Company previously held approximately 200,000 net acres. The Company has terminated its Lease Acquisition and Development Agreement with Cedar Strat Corp. and cancelled the Promissory Note dated March 30, 2006 pursuant to which the Company lent Cedar Strat Corp. the sum of US$200,000 due November 30, 2006.

Cancellation of Proposed Loan from Q Investments Ltd.

The Company has been notified that its negotiations to enter into a $7,500,000 loan from Q Investments Ltd. ("Q") (TSX VENTURE:QI) (a related party of the Company), as previously announced on July 18, 2008, has been cancelled due to current market conditions.

About XXL Energy Corp.

XXL, headquartered in Houston, is an independent oil and gas exploration and development company focused in the Greater Green River Basin of Wyoming, the Columbia River Basin of Washington and the Williston Basin of North Dakota.

In the interests of providing Company shareholders and potential investors with information regarding the Company, including the Company's assessment of its and its subsidiaries' future plans and operations, certain statements included in this press release may constitute forward-looking information or forward-looking statements (collectively, "forward-looking statements"). All statements contained herein that are not clearly historical in nature are forward-looking, and the words "anticipate", "believe", "expect", "estimate" and similar expressions are generally intended to identify forward-looking statements. Similarly, forward-looking statements in this press release include, but are not limited to anticipated developments of the Company's drilling projects in and the timing thereof capital investment levels and the allocation thereof, reserves and resources estimates, exploration plans, acquisition and disposition plans including farmout plans, net cash flows, geographic expansion and plans for seismic surveys. In addition, please note that statements relating to "reserves" or "resources" are deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves and resources described can be profitably produced in the future. Such statements represent the Company's internal projections, estimates or beliefs concerning, among other things, an outlook on the estimated amounts and timing of capital expenditures, anticipated future debt levels and incentive fees or revenues or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. These statements are only predictions. Actual events or results may differ materially. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievement since such expectations are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause the Company's actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, the Company and the foregoing list of important factors is not exhaustive. These forward-looking statements are made as of the date hereof disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise. Company shareholders and potential investors should carefully consider the information contained in the Company's filings with Canadian securities administrators at www.sedar.com before making investment decisions with regard to the Company.

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

Contact Information

  • XXL Energy Corp.
    Victor Barcot
    EVP of Business Development and Investor Relations
    (713) 922-0383
    or
    Brisco Capital Partners Corp.
    Graeme Dick
    (403) 313-9663
    Email: graeme@briscocapital.com