Drake Pacific Enterprises Ltd.

Drake Pacific Enterprises Ltd.

July 06, 2009 12:06 ET

Drake Management Changes and Operations Update

CALGARY, ALBERTA--(Marketwire - July 6, 2009) - Drake Pacific Enterprises Ltd. (TSX VENTURE:DPE)

Management and Director Update

Drake Pacific Enterprises Ltd (DPE) announces that Mr. Roger Penner has resigned as President, CEO and director. Mr. Penner will continue on with DPE as a consulting geologist. The Board of Directors thanks Mr. Penner for his more than nine years of contribution to DPE and looks forward to the continued relationship.

Mr. Neil Orr has been appointed President and CEO of Drake. Mr. Orr was a vice-president and director with the company for the past two years and has over twenty years of managerial and executive experience.

Bank Credit Facility Renewed

DPE has successfully negotiated a renewal of its credit facility at $3.8 Million. Increased reserves, production and cost controls over the last six months have allowed DPE to maintain this level of credit despite dramatic decreases in energy prices.


DPE has completed the acquisition of additional working interest in Sousa, Swan hills, Forestburg, and Retlaw from a private oil and gas company (PrivateCo) for the consideration of approximately $537,000 in the form of $250,000 cash and $287,000 release of receivables. The transaction was completed in late June and is effective April 1, 2009. This acquisition will add approximately 31 barrels of oil equivalent per day (boed) (12% oil).

The current acquisition has an effective price of $17,300 per boed. The reserve value for the working interest before tax proved and probable reserves (NPV 10%) is approximately $1,130,000 based on the evaluation at March, 2009 by Sproule and Associates.


As a result of the current natural gas prices, approximately 80 boed have been temporarily shut in to conserve reserves and control costs. With the completion of the recent acquisition and including the effect of the recent shut ins, DPE has current production of approximately 220 Boed with some additional production expected from the new 11-12 well when it ramps up to full production in July. Continued focus on cost controls, undervalued acquisitions, and a number of exploitation projects are planned for the summer.

Summer/Winter Program

With recent working interest and land acquisitions, the company has identified three oil exploitation opportunities, two in our core area of Sousa and one in one of our southern areas. Given current oil prices, these drilling and recompletion targets will be given key priority in our upcoming program.

"Controlling costs and improving production is critical to managing the company during these challenging times. We believe pursuing these new oil opportunities will be the key to dramatic growth in the coming months." said Drake president, Mr. Neil Orr.

Drake Pacific Enterprises Ltd. is active in oil and gas exploration and development in Alberta and Saskatchewan. Headquartered in Calgary, Alberta, Canada, the Company is publicly traded on the Toronto Stock Exchange Venture Board under the stock symbol DPE.V.

This news release contains forward-looking information. Implicit in this information are assumptions regarding commodity pricing, production, royalties and expenses that, although considered reasonable by the Company at the time of preparation, may prove to be incorrect. These forward-looking statements are based on certain assumptions that involve a number of risks and uncertainties and are not guarantees of future performance. Actual results could differ materially as a result of changes in the Company's plans, commodity prices, equipment availability, general economic, market, regulatory and business conditions as well as production, development and operating performance and other risks associated with oil and gas operations. There is no guarantee made by the Company that the actual results achieved will be the same as those forecasted herein. Barrel of oil equivalent ("boe") amounts may be misleading, particularly if used in isolation. A boe conversion ratio has been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel and is based on an energy equivalent conversion method application at the burner tip and does not necessarily represent an economic value equivalent at the wellhead.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.

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