Canoro Resources Ltd.
TSX VENTURE : CNS

Canoro Resources Ltd.

February 27, 2008 18:06 ET

Canoro Resources Ltd. Announces Third Quarter Financial Results

CALGARY, ALBERTA--(Marketwire - Feb. 27, 2008) - Canoro Resources Ltd. (TSX VENTURE:CNS):

Q3 (Sept. - Dec. 2007) Highlights:

- Raised gross $33.5 million through a bought deal financing and overallotment at $1.70/share to fund Canoro's appraisal and development activities at Amguri

- Successfully tested Amguri 11 at 3,190 boe/d from the main Barail zone plus two new reservoirs and approximately 65 meters of net pay.

- Following quarter-end, tied-in Amguri 10B and 11, significantly increasing the production of condensate and natural gas production and productive capacity which is limited by current facility constraints

- Increased net proven plus probable reserves to 9,326 mboe at December 31, 2007 and NPV discounted at 10% before taxes with forecast prices to US$167.3 million

- Well capitalized with no debt and working capital of $37.7 million

- Reached price agreement with oil purchaser to receive a $4-6/bbl premium over Nigerian Bonny Light benchmark price. Retroactive difference received.

- Signed two North American drilling rigs to one year contract with one year option

- Forecasting capital expenditures over the next 12-15 months of approximately $47.0 to $52.0 million on Amguri, AA-ON/7 and AA-ONN-2003/2

- Strengthening team with VP, Geoscience and Chief Geologist additions

Canoro has filed its unaudited interim consolidated financial statements for the three and nine months ended December 31, 2007, related Management's Discussion and Analysis, and the required interim certificates by the CEO and CFO. These documents are available at www.sedar.com or on Canoro's website at www.canoro.com

Amguri

Building on last quarter's success, Canoro has embarked on its largest drilling program at Amguri to appraise the current limits of the field. The first well of the drilling program, Amguri 13 started operations in early February, with results expected from this well in late March. The rig will then proceed to Amguri 5 for work over operations. Drilling operations are anticipated to begin on Amguri 12 in April with the arrival of the deeper drilling rig.

Facilities work to remove the production constraints is continuing as planned, with an expected completion in March. Once completed, Canoro's net production should increase above 1,200 boe/d as previously reported.

AA-ON/7

On this block, the seismic acquisition program of 40 km of 2D seismic is continuing as planned, with expected completion in April. The results of this seismic are expected to solidify the previously identified foothills drilling prospects. The shallow drilling rig is planned to begin drilling the Borkathani exploration well after completion of the Amguri 5 work over.

AA-ONN-2003/2

The operator has started acquiring 100 km2 of 3D seismic on the block to provide additional information around two leads identified on the block through the previously acquired 2D seismic program. Additionally, two prospects were identified for drilling, with an anticipated start date late this year.

Canoro is a Canadian-based international oil and gas company operating in the Assam/Arakan basin of northeast India. Canoro is the operator of Amguri field with a 60% working interest. Canoro is the operator with a 65% working interest in the AA-ON/7 exploration block. Canoro also has a 15% non-operated working interest in the AA-ONN 2003/2 exploration block.

Common shares of Canoro trade on the TSX Venture Exchange under the symbol 'CNS'.

This news release contains certain forward-looking statements, including management's assessment of future plans and operations, and capital expenditures and the timing thereof, that involve substantial known and unknown risks and uncertainties, certain of which are beyond Canoro's control. Such risks and uncertainties include, without limitation, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, inability to retain drilling rigs and other services, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources, the impact of general economic conditions in Canada, the United States and overseas, industry conditions, changes in laws and regulations (including the adoption of new environmental laws and regulations) and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in foreign exchange or interest rates, stock market volatility and market valuations of companies with respect to announced transactions and the final valuations thereof, and obtaining required approvals of regulatory authorities. Canoro's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurances 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, including the amount of proceeds, that Canoro will derive therefrom. Readers are cautioned that the foregoing list of factors is not exhaustive. All subsequent forward-looking statements, whether written or oral, attributable to Canoro or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release and Canoro does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws. Boe may be misleading, particularly if used in isolation. A boe conversion ratio of 6 mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

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

Contact Information

  • Canoro Resources Ltd.
    Rob McInnis
    Vice President, Business Development and Corporate Affairs
    (403) 543-5748
    (403) 543-5740 (FAX)
    Email: mail@canoro.com
    or
    Canoro Resources Ltd.
    700, 717 - 7th Ave SW
    Calgary, Alberta T2P 0Z3
    Website: www.canoro.com