Birch Mountain Resources Ltd.

Birch Mountain Resources Ltd.

August 18, 2005 16:04 ET

Birch Mountain Resources Announces Equity Offering

CALGARY, ALBERTA--(CCNMatthews - Aug. 18, 2005) -

Not for distribution to United States newswire services or for dissemination in the United States.

Birch Mountain Resources Ltd. ("Birch Mountain") (TSX VENTURE:BMD)(AMEX:BMD) announced today that it has filed a preliminary short form prospectus with the securities commissions in the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario and Quebec in connection with a treasury offering of common shares to raise gross proceeds of approximately $32 million. The offering is being led by RBC Capital Markets and will include a syndicate of underwriters (the "Underwriters"). Birch Mountain will grant the Underwriters an option (the "Underwriters' Option"), exercisable in whole or in part until 48 hours prior to closing, to purchase up to an additional $4 million of common shares at the same offering price. Should the Underwriters' Option be fully exercised, the total gross proceeds of the offering would be approximately $36 million. Birch Mountain expects the pricing of the offering to occur on or about August 19, 2005 and closing to occur on or about September 2, 2005.

Birch Mountain intends to use net proceeds from the offering for initial operations of the Muskeg Valley Quarry (the "MVQ"), continuing development of Hammerstone, and for general corporate purposes.

Birch Mountain is developing the industrial mineral potential of its extensive mineral properties located in the oil sands area of northeastern Alberta. Limestone from the MVQ and Hammerstone will be processed as construction aggregates and as rock for making concrete and asphalt. Reagent grade limestone can be used directly or in processed form as quicklime in applications such as flue gas desulphurization, water treatment, pulp and paper manufacturing, and soil and biosolids stabilization. Birch Mountain believes that the strong global demand for oil and the heightened profile of Alberta's oil sands should ensure long-term demand for limestone products from the MVQ and Hammerstone.

The common shares to be sold have not been and will not be registered under the United States Securities Act of 1933 and may not be offered or sold in the United States absent registration under the United States Securities Act of 1933 or an applicable exemption therefrom.

Forward Looking Statements: This news release contains certain forward-looking statements. All statements, other than statements of historical fact, included herein, including without limitation, statements regarding potential mineralization, resources and reserves, exploration results, research and development results, and the future plans and objectives of Birch Mountain are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from Birch Mountain's expectations are disclosed elsewhere in documents that are available to the public at and

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

Contact Information

  • Birch Mountain Resources Ltd.
    Douglas Rowe
    President & CEO
    403.263.9888 (FAX)
    Birch Mountain Resources Ltd.
    Hansine Ullberg
    VP Finance & CFO
    403.263.9888 (FAX)