Exall Resources Limited
OTC Bulletin Board : EXALF

Exall Resources Limited

December 05, 2006 13:21 ET

Exall Energy to Acquire Kingsmere Exploration Ltd.

TORONTO, ONTARIO--(CCNMatthews - Dec. 5, 2006) - Exall Resources Limited ("Exall")(TSX:EXL)(OTCBB:EXALF) is pleased to announce that its subsidiary Exall Energy Corporation ("EEC") has reached an agreement with the management and major shareholders of Kingsmere Exploration Ltd. ("Kingsmere"), a private Alberta oil and gas corporation, with respect to the terms of an offer by EEC to acquire all of the issued and outstanding shares of Kingsmere, subject to receipt of all required regulatory and exchange approvals. The acquisition of Kingsmere would approximately double EEC's production, and significantly increase the number of exploration and development targets.

As announced on November 23, 2006, EEC has engaged D&D Securities Company and Canaccord Capital Corporation to raise up to an additional $5,000,000 to finance EEC's ongoing operations (the "Financing"). Following completion of the Financing and on closing the acquisition of Kingsmere, the former shareholders of Kingsmere would represent about 30% of the outstanding shares of EEC.

It is anticipated that the offer will be made to all holders of shares in the capital of Kingsmere this week and that the transaction will be completed by no later than December 20, 2006. Subject to the tender of shares of Kingsmere representing at least 66 2/3 of the issued and outstanding securities of Kingsmere, EEC will move to close the acquisition in the most expeditious manner possible. More information will be forthcoming once the formal documentation has been completed.

Exall Resources Limited is a Toronto Stock Exchange listed company that trades under the symbol EXL. Exall is active in its business of gold exploration and development in Red Lake, Ontario with four drill rigs currently active on the Gold Eagle property, as well as oil and gas exploration, development and production from its properties in Alberta, British Columbia, Texas and in the North Sea offshore the United Kingdom. Exall owns 3,398,000 common shares of Southern Star Resources Inc. Exall has 83,453,804 common shares issued and outstanding.

Forward-Looking Statement

The statements made in this News Release may contain forward-looking statements that may involve a number of risks and uncertainties. Actual events or results could differ materially from the Company's expectations and projections. Accordingly, readers should not place undue reliance on forward-looking statements. For a more detailed discussion of such risks and other factors, refer to Exall's filings with Canadian securities regulators available on www.sedar.com or the Company's website at www.exall.com.

Contact Information

  • Exall Resources Limited
    Stephen G. Roman
    Chairman, President and CEO
    (416) 368-3949
    (416) 368-5146 (FAX)
    Website: www.exall.com