Challenger Energy Corp.
TSX VENTURE : CHA

Challenger Energy Corp.

April 03, 2006 10:30 ET

Challenger Energy Announces Drilling in Trinidad and Tobago and Releases 2005 Financial Operating Results

CALGARY, ALBERTA--(CCNMatthews - April 3, 2006) - Challenger Energy Corp. ("Challenger" or the "Company")(TSX VENTURE:CHA) of Calgary Alberta, Canada is pleased to announce its 2005 financial operating results and that it is poised to commence drilling in Trinidad and Tobago with Canadian Superior Energy Inc. (AMEX:SNG)(TSX:SNG) on or before September or October of 2006. Attached is our "Message to Shareholders" from our 2005 Annual Report. Our "Management's Discussion and Analysis" and financial statements for the year ended December 31, 2005 can be reviewed in its entirety on Challenger's website, www.chaenergy.ca.

Commenting today, Challenger's President and Chief Executive Officer, Neil Mackenzie said, "We are very pleased to be moving forward expeditiously with Canadian Superior on our drilling program in Trinidad and to announce our financial operating results".

Challenger Energy Corp. is a Calgary Alberta, Canada based oil and gas exploration Company which is currently focusing on "high impact world-class" opportunities in Trinidad.

Cautionary Statements

This news release contains forward-looking information on future production, project start-ups and future capital spending. Actual results or estimated results could differ materially due to changes in project schedules, operating performance, demand for oil and gas, commercial negotiations or other technical and economic factors or revisions. The information in this news release also includes certain information and statements about management's view of future events, expectations, plans and prospects that constitute forward looking statements. These statements are based upon assumptions that are subject to significant risks and uncertainties. Because of these risks and uncertainties and as a result of a variety of factors, the actual results, expectations, achievements or performance may differ materially from those anticipated and indicated by these forward looking statements. Although the Company believes that the expectations reflected in forward-looking statements are reasonable, it can give no assurances that the expectations of any forward-looking statements will prove to be correct.

Statements contained in this news release relating to future results, events and expectations are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Corporation, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such statements.

MESSAGE TO SHAREHOLDERS

On behalf of the team at Challenger Energy Corp., I am very pleased to provide you with a summary of our achievements in 2005 and our go forward plan with Canadian Superior Energy Inc. ("Canadian Superior", TSX, AMEX: SNG) to drill offshore Trinidad and Tobago on one of the best natural gas plays in the world, on or before September or October of 2006. During the latter part of 2005, after completing our go-public transaction, we commenced trading on the Toronto Venture Stock Exchange (TSXV) and subsequent to the year-end we completed the raising of $19.5 million in equity financing to fund our operations in Trinidad. I would like to thank our shareholders for their support and we are committed to moving forward into 2006 and beyond with a conservative disciplined financial approach. 2006 will be an exciting year for us.

Highlights of our achievements in 2005 include:

- On August 29, 2005, Challenger, a private company, entered into an amalgamation agreement with a public company Global Express Energy Inc.

- In October 2005, Challenger completed a private placement raising $1.2 million.

- On December 1, 2005, Challenger became a public company through a reverse takeover of Global Express.

- On December 12, 2005, Challenger began trading on the Toronto Venture Stock Exchange (TSXV) under the stock symbol "CHA".

Prior to Challenger becoming a public company in 2005, three notable agreements were executed that have established our core focus.

- In November 2004, Challenger entered into a participation agreement as a non-competitive financial industry partner with Canadian Superior with respect to the development of Canadian Superior's Intrepid "Block 5(c)" located offshore Trinidad. Challenger will be funding one-third of Canadian Superior's initial cost of drilling 3 wells off-shore Trinidad on Block 5(c) to obtain 25 percent of the revenue Canadian Superior earns from Block 5(c).

- Also in November 2004, Challenger entered into a financial participation agreement with Canadian Superior to have the opportunity to participate with Canadian Superior on Canadian Superior's Mayaro and Guayaguayare Bay lands located off-shore Trinidad. Under this agreement Challenger may pay one-third of Canadian Superior's costs related to 2 wells Canadian Superior may drill on the Mayaro and Guayaguayare block to receive 25 percent of Canadian Superior's revenues from this block.

- Also in November 2004 Challenger entered into a Farm-Out agreement, which has subsequently been amended, whereby Challenger has the opportunity to participate in Canadian Superior's next Mariner test well, off-shore Nova Scotia. To earn a 25 percent interest in Canadian Superior's Mariner Block, Challenger may farm-in by paying one-third of the cost of the next Mariner well. Challenger has the further right to participate on the same terms on Canadian Superior's Marauder and Marconi Blocks, off-shore Nova Scotia.

We are pleased to report that on March 19, 2006, the operator of Block 5(c), Canadian Superior, entered into a firm multi-well drilling contract for the Kan Tan IV Semi-Submersible Offshore Drilling Rig managed by A. P. Moller-Maersk ("Maersk"), of Copenhagen, Denmark and owned by Beijing Zhiyuan Industries Company Limited ("Beijing Zhiyuan"), of Beijing, China. Beiing Zhiyuan, is a member of the SINOPEC Group of companies, both Maersk and Beijing Zhiyuan who are truly world class companies. Canadian Superior will be bringing this rig into Trinidad and Tobago with no other oil and gas companies involved in the contracting of this offshore drilling rig, at a very favorable day rate, honoured by Maersk and Beijing Zhiyuan, negotiated by Canadian Superior several months ago, as compared to day rates which have gone up considerably. Trinidad and Tobago is a very economic and important source of North America's naturally gas supply. This rig will commence drilling of two back-to-back wells for Canadian Superior and ourselves offshore Trinidad on "Intrepid" Block 5 (c) on or before September or October of 2006.

TRINIDAD AND TOBAGO

Offshore Trinidad is a highly desirable oil and gas basin. Offshore Trinidad has multiple large exploration and development opportunities as evidenced by recent drilling successes in the Columbus Basin where Block 5(c) is located. It also has well developed, and developing, LNG facilities and capacity, and ready access to international markets. 80% of North America's LNG is supplied from Trinidad, and some of the largest producing wells in the world are located in Trinidad. 15 of British Petroleum's top 25 producing wells world-wide are located in Trinidad in close proximity to where we will be drilling. In Trinidad and Tobago natural gas at the wellhead is currently selling near Henry Hub pricing.

The "Intrepid" Block 5(c) is comprised of 80,041 acres located about 96 kilometers (60 miles) off the east coast of the island of Trinidad with water depths in the range of 150 to 450 meters (500 to 1,500 feet) and all wells in Block 5(c) will be drilled from the semi-submersible drilling rig, with the first two wells in water depths of about 245 meters (800 feet). These prospects have been estimated to potentially contain over 4 TCF of undiscovered resources of natural gas and condensate. Structures of similar size are located in the immediate vicinity of "Intrepid" Block 5(c).

OUTLOOK

Accordingly 2006 will be a very exciting year for Challenger. We are looking forward to assisting Canadian Superior with our drilling in Trinidad, in this truly "World-Class Basin". We would again like to thank shareholders for your tremendous support!

Respectfully submitted on behalf of the Management, Staff and Directors of Challenger Energy Corp.:



CHALLENGER ENERGY CORP.

Per:


Neil Mackenzie
President and Chief Executive Officer
March 31, 2006


The TSX Venture Exchange neither approved nor disapproved the contents of this press release.

Contact Information

  • Challenger Energy Corp.
    Calgary, Alberta
    Attn: Investor Relations
    (403) 503-8810
    www.chaenergy.ca