Choice Resources Corp.

Choice Resources Corp.

March 22, 2005 22:00 ET

Choice Announces Up To $15 Million Private Placement Financing And Increase In Capital Budget


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: CHOICE RESOURCES CORP.

TSX VENTURE SYMBOL: CZE

MARCH 22, 2005 - 22:00 ET

Choice Announces Up To $15 Million Private Placement
Financing And Increase In Capital Budget

CALGARY, ALBERTA--(CCNMatthews - March 22, 2005) - Choice Resources
Corp. ("Choice" or the "Corporation") (TSX VENTURE:CZE) announces that
it has appointed Research Capital Corporation as lead Agent to raise up
to $10 million through a marketed private placement offering, with the
Agents having an option to increase the size of the offering to $15
million. Research Capital has formed a syndicate, including CIBC World
Markets Inc., Dundee Securities Inc. and Wolverton Securities Ltd. to
sell the securities. The offering, which will be on a best efforts
agency basis, will be comprised of (i), approximately 65% of the
proceeds, units consisting of one common share and one-half of one
warrant to purchase an additional common share at a price of $1.00 per
share for a period of 18 months, and (ii) the balance (35%),
flow-through common shares. Pricing of the units and the flow-through
common shares will be determined in the context of the market.

Proceeds from the flow-through share private placement will be used to
fund qualified exploration expenditures. Proceeds from the unit offering
will be used for an expanded capital budget and for general corporate
purposes.

The proceeds will enable the corporation to implement a capital budget
in the fiscal year of $21 million and will allow the Corporation to take
a significantly increased share of the planned Pincher Creek horizontal
well. To date, exploration has proceeded on target and three exploratory
wells will be completed by the end of March. A fourth well has been
delayed due to early spring break up and will be drilled in the summer
or fall when conditions permit. The 3-28 well at Snipe Lake is on stream
as expected, and producing at a restricted rate of 2 mmscf/d. The
working interest in this well was increased to 35%. The 14-17 (Choice
49% working interest) well at Snipe will be on stream at the end of
March and is expected to produce 750 mcf/d. The Corporation expects to
drill up to 9 exploration wells and up to 25 development wells over the
2005 fiscal year as a result of the financing.

The Agents will receive a cash fee equal to 7% of the gross proceeds
raised from the placement, as well as broker's warrants, exercisable for
a period of 24 months, to purchase a number of units equal to 7% of the
number of common shares and flow-through common shares issued in the
offering, at a price equal to the unit offering price. All shares and
warrants issued through the private placement will be subject to a hold
period of four months from the date of closing.

Completion of each of the private placements is subject to certain
conditions, including approval of the offering by the Board of Directors
of Choice, satisfactory due diligence by the Agent and receipt of all
necessary regulatory approvals.

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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Choice Resources Corp.
    Gordon Harris
    President and Chief Executive Officer
    (403) 216-5821
    or
    Choice Resources Corp.
    Steve Austin
    Chief Financial Officer
    (403) 216-5821
    or
    Choice Resources Corp.
    Dennis Forgeron
    Vice President and Chief Operating Officer
    (403) 216-5821
    (403) 216-5828 (FAX)
    info@choiceresources.ca
    The TSX Venture Exchange has not reviewed and does not accept
    responsibility for the adequacy or accuracy of this news release.