Longbow Resources Inc.
TSX VENTURE : LBR

Longbow Resources Inc.

April 17, 2007 15:38 ET

Longbow Resources Announces Change in Management Structure and Option Grants

CALGARY, ALBERTA--(CCNMatthews - April 17, 2007) - Longbow Resources Inc. (TSX VENTURE:LBR) ("Longbow" or "the Company") wishes to announce certain changes in its management structure and the granting of stock options to its directors, officers, employees and consultants under the terms of its existing stock option plan (the "Plan"). Following the recent share consolidation and name change approved by the shareholders, the Company is now adopting a more conventional management structure, which the Company believes will help it gain improved access to capital markets.

Further to the previous announcement on February 20, 2007, the Company's audit committee has completed its review of the Company's independent engineering evaluations and has recommended that the Company acquire the issued shares of Discovery Drilling Funds Management Inc. ("DDFM") and effectively terminate its existing management agreement dated August 1, 2006, as amended (the "Management Agreement") with DDFM for a purchase price of $618,000, subject to the approval of the TSX Venture Exchange. Under the terms of the Management Agreement, DDFM agreed to provide all required management services and technical support to Longbow in exchange for a royalty interest in certain of Longbow's oil and gas properties. The purchase price for the DDFM shares was based upon an independent engineering evaluation of the value of the DDFM royalty interest. As the principals of DDFM are directors and officers of the Company, the acquisition of the DDFM shares, to be made effective January 31, 2007, is subject to the review and approval of the TSX Venture Exchange (the "Exchange"). The proposed share acquisition is a "related party transaction" within the meaning of applicable securities laws, however, it is exempt from the formal valuation and minority approval requirements of such laws as the fair market value of the consideration to be paid is less than 25% of Longbow's market capitalization. The Board of Directors believes that the Management Agreement has accomplished its original purpose of preserving cash flow and minimizing dilution to shareholders throughout its rebuilding phase and that it is now in the best interests of Longbow to acquire the DDFM shares and thereby, effectively terminate the Management Agreement. Following the acquisition of DDFM by the Company, all members of Longbow's management team will be compensated by way of an industry-competitive combination of salary and stock options.

In addition, the Company also wishes to report that, pursuant to the Company's Plan and subject to regulatory approval, the Board of Directors has approved today the granting of share purchase options to the following eligible individuals:



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Number of
Name of Optionee Title(s) Options Granted
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Chief Executive Officer
Sean Kehoe and Director 580,000
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Charles Cook President 530,000
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Mark Ross Vice President, Operations 200,000
(Consultant) and Director
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Blaine Reid Chief Financial Officer 100,000
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Rob Panasiuk Director 50,000
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Don Pestell Director 50,000
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Each of the above-mentioned share purchase options is for a five year term expiring on April 15, 2012 at an exercise price of $0.455 per share. The options will vest in three equal instalments over a two year period, with one-third of the options vesting immediately. The options granted to Messrs. Kehoe and Cook in their capacity as officers of Longbow are conditional upon the completion of the DDFM acquisition.

The Company's Plan is a rolling plan under which 10% of the issued and outstanding common shares of the Company (currently 1,606,700 shares) are reserved for issuance to eligible individuals from time to time. The Plan was approved by the shareholders of Longbow at its last annual meeting held on June 15, 2006. Following these option grants, there are now outstanding options to purchase a total of 1,605,000 common shares of the Company, which is approximately 10% of the issued and outstanding common shares.

Longbow is a junior oil and natural gas company based in Calgary, Alberta with properties located in Alberta, British Columbia and Saskatchewan.

Certain statements contained herein may constitute forward-looking statements. These statements relate to future events or our future performance. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe" and similar expressions. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. We believe that the expectations reflected in the forward-looking statements are reasonable based upon management's current views but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. No assurance can be given that actual results, performance or achievement expressed in, or implied by these forward-looking statements will occur, or if they do, that any benefits may be derived from them. Past results have been applied in drawing a conclusion or making a forecast or projection set out in the forward-looking information.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this press release.

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