The Buffalo Oil Corporation
TSX VENTURE : BFO

The Buffalo Oil Corporation

October 03, 2005 09:17 ET

Buffalo Oil Completes Acquisition

CALGARY, ALBERTA--(CCNMatthews - Oct. 3, 2005) - The Buffalo Oil Corporation (TSX VENTURE:BFO)("Buffalo" or the "Corporation") reports that it has completed its previously announced purchase of oil and gas properties on the reserve lands of the Frog Lake First Nation in eastern Alberta. Buffalo acquired a 65% working interest in the producing oil and gas wells and a 50% working interest in all undeveloped lands, with the balance of the interests being held by Frog Lake Energy Resources Corp. ("FLERC"), the wholly-owned oil and gas company of the Frog Lake First Nation. Buffalo has granted FLERC an option to acquire an additional 15% of the interest in the producing properties, exercisable at any time up to June 30, 2006. The Corporation will be the operator of the properties which are productive for oil in the GP, Sparky and McLaren zones and for natural gas in the Colony zone.

At current rates, Buffalo's share of production from the properties is expected to be approximately 420 barrels of heavy oil and 450 thousand cubic feet of natural gas per day. A number of shut-in wells on the properties are being targeted for workover and maintenance operations and production should increase as a result. The Corporation also acquired leases for approximately 2,560 gross acres of undeveloped land, most of which has been approved for ten acre spacing of oil wells. Sixty eight potential drilling locations have been identified on these lands and at least two wells will be drilled in the fourth quarter 2005.

The Corporation used its cash on hand to complete the transaction and anticipates funding the remainder of its 2005 capital expenditure program from cash flow and bank credit lines. This acquisition has resulted in Buffalo's production rate more than doubling to approximately 900 boe/day. Drilling activities in the fourth quarter 2005 are expected to increase that production rate to 1,000 boe/day by year end.

Buffalo is an emerging junior oil and gas company engaged in the exploration, development and production of oil and gas reserves in Alberta and Saskatchewan.

This press release contains forward-looking statements. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, reliance should not be placed on forward-looking statements. Buffalo's actual results, performance or achievement could differ materially from those expressed in, or implied by these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that Buffalo will derive therefrom. Buffalo disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

The TSX Venture Exchange has neither approved nor disapproved this press release and does not accept responsibility for the adequacy or accuracy of the contents.

Contact Information

  • The Buffalo Oil Corporation
    Trevor Penford
    (403) 252-2462
    Email: tpenford@buffalo-oil.com
    or
    The Buffalo Oil Corporation
    William (Bill) Trickett
    (403) 252-2462
    (403) 252-1399 (FAX)
    Email: btrickett@buffalo-oil.com
    or
    The Buffalo Oil Corporation
    Suite 211, 7710 - 5th Street S.E.
    Calgary, Alberta T2H 2L9