Donner Petroleum Ltd.

November 27, 2006 18:16 ET

Donner Announces Private Placement, Oil and Gas Acquisitions, New Board Members and New Management Team

CALGARY, ALBERTA--(CCNMatthews - Nov. 27, 2006) - Donner Petroleum Ltd. ("Donner" or the "Company") is pleased to announce that it has raised significant equity, purchased oil and gas properties, appointed a new Board of Directors and hired an Oil and Gas Management Team.

Donner issued, by way of private placement, approximately 304.8 million common shares at $0.074 per share for net proceeds of approximately $22.6 million by way of private placement. In conjunction with the private placement, Donner entered into a put and call obligation agreement to issue an additional 82.6 million common shares at $0.074 per share for proceeds of $6.1 million. Donner also issued approximately 5.7 million common shares to acquire all the issued and outstanding shares of a private company engaged in oil and gas operations. The company's main asset was seismic data over certain properties acquired as part of the acquisition noted below.

Pursuant to the assignment of the interest in a purchase and sale agreement from the private company, Donner acquired oil and gas properties from Chamaelo Exploration Ltd. for approximately $6.6 million prior to adjustments for net revenues and capital expenditures. The oil and gas properties currently produce approximately 100 boepd (50% oil and NGLs and 50% natural gas) in West Central and Southern Alberta, in addition to having undeveloped land (11,700 net acres) and farm-in acreage (13,600 net acres) in North East B.C., West Central Alberta and Southern Alberta.

Donner is also pleased to announce the appointment of Larry Moeller, Don Cowie, Daryl Gilbert, Brian Krausert and Rob Zakresky to its Board of Directors and the hiring of a new Management Team - Rob Zakresky (President & CEO), Nolan Chicoine (VP Finance and CFO), Terry Trudeau (VP Operations & COO), Rick Sereda (VP Exploration), Weldon Dueck (VP Business Development), Helmut Eckert (VP land), and Kevin Keith (VP Production). The Board of Directors and Management Team were all prior offices and directors of Chamaelo Exploration Ltd.

Donner has a shareholders' meeting scheduled for January 12, 2007 at which shareholders will be asked to vote on changing the Company's name to Crocotta Energy Inc. and to consolidate the common shares on a 1 for 13.5135 basis. If the consolidation is approved, the Company will have approximately 30 million shares issued, including the shares issuable under the put and call obligation agreement, in addition to certain performance warrants and stock options outstanding.

Donner currently has $22 million in working capital and has started an active drilling program on the acquired properties. The Company will also look to expand its operations through additional acquisitions and farm-ins.

Contact Information

  • Donner Petroleum Ltd.
    700, 639 -5th Ave SW
    Calgary, Alberta T2P 0M9
    (403) 538-3737
    (403) 538-3735 (FAX)
    Donner Petroleum Ltd.
    Robert Zakresky
    President and Chief Executive Officer
    (403) 538-3736
    Donner Petroleum Ltd.
    Nolan Chicoine
    Vice President, Finance and Chief Financial Officer
    (403) 538-3738