Stylus Energy Inc.

March 01, 2005 08:30 ET

Kinloch Resources Inc. and Stylus Exploration Inc. Complete Merger to form Stylus Energy Inc.


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: STYLUS ENERGY INC.

MARCH 1, 2005 - 08:30 ET

Kinloch Resources Inc. and Stylus Exploration Inc.
Complete Merger to form Stylus Energy Inc.

CALGARY, ALBERTA--(CCNMatthews - March 1, 2005) - Stylus Energy Inc. is
pleased to announce that the previously announced merger (the "Merger")
between Kinloch Resources Inc. ("Kinloch") and Stylus Exploration Inc.
("Stylus") has been completed.

The Merger was completed by way of plan of arrangement (the
"Arrangement") which provided for the amalgamation of Kinloch and Stylus
to form a new public entity called Stylus Energy Inc. ("Stylus Energy").
Pursuant to the Arrangement: (i) Stylus common shares and Stylus special
warrants were converted into Stylus Energy common shares, on the basis
of 1.0833 Stylus Energy common shares for each Stylus common share or
Stylus special warrant held and Kinloch common shares were converted
into Stylus Energy common shares on the basis of one Stylus Energy
common share for each three Kinloch common shares held.

The Merger received the unanimous support of the boards of directors of
Stylus and Kinloch and was approved by the securityholders of both
companies at meetings held February 28, 2005. Stylus Energy will be
engaged in the exploration, development and production of oil and gas
and will continue to carry on the businesses and own the assets of each
of Stylus and Kinloch.

Upon completion of the Merger, Paul Evans, the President and C.E.O. of
Stylus Energy stated that, "We have a strong management team in place at
Stylus Energy to expand the existing production base of approximately
1,250 boepd and estimated proved and probable reserves of approximately
3 million boe. We plan to exploit the 116,000 net undeveloped acres
which we hold and will review other growth and acquisition opportunities
as they arise". Upon satisfaction of the final conditions of the Toronto
Stock Exchange (the "TSX"), the common shares of Stylus Energy are
expected to commence trading shortly on the TSX , under the symbol "STY".

This news release may contain forward-looking statements concerning the
anticipated performance of Stylus Energy. Forward-looking statements are
based on the estimates and opinions of management at the date the
statements are made, and Stylus Energy undertakes no obligation to
update forward-looking statements if conditions or opinions should
change.

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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Stylus Energy Inc.
    Paul D. Evans, P.Geol.
    President and CEO
    (403) 517-8791
    (403) 517-8798 (FAX)
    Email: pevans@stylusenergy.com
    Website: www.stylusenergy.com
    The Toronto Stock Exchange has not reviewed and does not accept
    responsibility for the adequacy or accuracy of this Press Release.