Birch Lake Energy Inc.

April 28, 2011 09:00 ET

Birch Lake Energy Inc. Announces Corporate Acquisition Involving Lochend Assets

CALGARY, ALBERTA--(Marketwire - April 28, 2011) - Birch Lake Energy Inc. ("Birch Lake" or the "Corporation) (TSX VENTURE:BLK) announced today that it has closed the acquisition of all of the issued and outstanding shares of a private corporation, the principal asset of which is an average non-operated working interest of 35% in certain petroleum and natural gas rights underlying 7,760 gross acres (2,718 net) in the Lochend – Bearspaw area of Alberta. Total consideration paid by Birch Lake to acquire the corporation with the interests underlying the 12.125 sections (4.25 net) was $3,250,000 comprised of $2,000,00 in cash and 5,000,000 common shares issued from the Corporation's treasury at a deemed price of $0.25 per share. This transaction is subject to approval of the TSX Venture Exchange.

William H. Petrie, the President and Chief Executive Officer of the Corporation stated "This acquisition furthers the Corporation's goal of developing light oil reserves through the use of horizontal drilling and new completion techniques. Together with our recently announced acquisition in the Halkirk area Viking play, this acquisition of Cardium-prospective lands provides Birch Lake shareholders the upside of participation in two of the most active play areas in Alberta. These lands are along a trend of high prices paid for leases offered at recent Crown land sales and high initial reported rates from recent Cardium horizontal well completions. The operator, a well-funded private company, is currently acquiring surface leases for three initial wells to be drilled beginning early July 2011. Based on current production spacing units for the area, the Corporation estimates that more than 40 horizontal wells could be drilled on the acquired leases. We are pleased that, as in the Halkirk acquisition, the vendors recognize the potential upside of owning equity in the Corporation by having agreed to accept a large portion of the acquisition consideration in shares of Birch Lake."

Forward Looking Statements:

This press release contains certain statements which constitute forward-looking statements or information ("forward-looking statements"), including statements regarding Birch Lake's business, such as anticipated exploration activities, which by their nature are forward-looking statements and which are subject to numerous risks and uncertainties, some of which are beyond Birch Lake's control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, operational risks in exploration and development, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and the ability to access sufficient capital from internal and external sources. Although Birch Lake believes that the expectations in our forward-looking statements are reasonable, our forward-looking statements have been based on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and assumptions are based upon currently available information. Such statements are subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in the forward looking information. As such, readers are cautioned not to place undue reliance on the forward looking information, as no assurance can be provided as to future results, levels of activity or achievements. The forward-looking statements contained in this document are made as of the date of this document and, except as required by applicable law, Birch Lake does not undertake any obligation to publicly update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement.

About Birch Lake Energy Inc.

Birch Lake is a junior oil and gas company engaged in the exploration for and the acquisition, development and production of oil and natural gas reserves. The Corporation's common shares are listed to trade on the TSX Venture Exchange under the symbol "BLK".

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Birch Lake Energy Inc.
    William H. Petrie
    President and Chief Executive Officer
    (403) 457-1944