Duvernay Oil Corp.
TSX : DDV

Duvernay Oil Corp.

January 20, 2006 08:19 ET

Duvernay Oil Corp. Expands 2006 Capital Program and Enters Into $55.6 Million Bought Deal Equity Financing

CALGARY, ALBERTA--(CCNMatthews - Jan. 20, 2006) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF U.S. SECURITIES LAW.

Duvernay Oil Corp. (TSX:DDV) is pleased to announce the expansion of its 2006 capital program from its previously announced guidance of $350 million to $400 million. The new program will primarily fund a significant expansion of the currently planned 2006 Deep Basin Alberta Exploration and Production program. The expansion includes potential incremental Duvernay operated farm-in and joint venture opportunities in the vicinity of existing Duvernay operated properties and several, drilling success based, new EP projects. These include follow-up projects to successful wells at Sundance, Fir, Oldman, and Pine. Duvernay is now planning an additional 100% Company owned and operated gas plant in the greater South Fir-Oldman area with a targeted late Q3 2006 start-up. The current expansion of the existing Cecilia 15-4 gas plant from 50 to 100 mmcf/d capacity remains on schedule for a Q2 start-up. The expanded capital program will also fund incremental follow-up opportunities to recent exploration success in the greater Sunset-Groundbirch area of British Columbia and at Puskwa, Alberta.

In conjunction with the expansion of the 2006 capital program, Duvernay has entered into a bought deal equity financing with a syndicate of underwriters led by Peters & Co. Limited and including FirstEnergy Capital Corp., Scotia Capital Inc., Blackmont Capital Inc., BMO Nesbitt Burns Inc., Raymond James Ltd., Sprott Securities Inc. and Octagon Capital Corporation for an offering of 1,250,000 common shares at a price of $44.50 per share for gross proceeds of $55.625 million. Completion of the financing is subject to all normal regulatory approvals. The common shares will be offered in each of the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario and Quebec by way of short form prospectus. The financing is expected to close on or about February 9, 2006. The net proceeds of the offering will be used to fund Duvernay's expanded capital program in 2006 and for general corporate purposes.

This news release shall not constitute an offer to sell or the solicitation of any offer to buy the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The common shares offered will not be and have not been registered under the United States Securities Act of 1933 (the "U.S. Securities Act") and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws.

This press release contains certain forward-looking statements, including expectations of future production, operating and financial results. These statements are based on Duvernay's current expectations and assumptions that could prove to be incorrect. The forward-looking statements are not guarantees of future performance and undue reliance should not be placed on them. Actual results may differ materially as a result of risks, uncertainties and other factors, such as: changes in the general economic, market, regulatory, industry and business conditions; fluctuations in commodity prices and currency exchange rates; the successful and timely implementation of growth projects; imprecision of reserve estimates; environmental risks; competition from other industry participants; availability of capital; and uncertainties resulting from potential delays or changes in plans, among others. See Duvernay's recent prospectus and other documents Duvernay files with Canadian securities regulatory authorities for further details, copies of which are available from Duvernay directly or on its website; www.duvernayoil.com or on the SEDAR website www.sedar.com

Contact Information

  • Duvernay Oil Corp.
    Michael Rose
    President and C.E.O.
    (403) 571-3600
    or
    Duvernay Oil Corp.
    Brian Robinson
    Vice-President, Finance and C.F.O.
    (403) 571-3609
    or
    Duvernay Oil Corp.
    Scott Kirker
    Manager, Corporate Affairs
    (403) 571-3683