Mahalo Energy Ltd.

TSX : CBM


Mahalo Energy Ltd.

June 05, 2006 20:04 ET

Mahalo Energy Ltd. Clarification

CALGARY, ALBERTA--(CCNMatthews - June 5, 2006) -

(Not for distribution to U.S. newswire services or for dissemination in the United States of America)

Mahalo Energy Ltd. (TSX:CBM): An error occurred in the fourth paragraph, second sentence of the Company's June 5, 2006 Press release. The sentence "On a combined basis, the Company has access to US $63.7 million in credit facilities." should have read "On a combined basis, the Company has access to CDN $63.7 million in credit facilities." The corrected copy follows:

Mahalo Energy Ltd. ("Mahalo" or the "Company") is pleased to announce that it has increased its borrowing capacity under its existing three-year US $50.0 million Revolving Credit Facility with the Union Bank of California.

Pursuant to the amended credit agreement, the approved borrowing base has been increased to US $33.0 million up from the previous US $23.5 million.

Mahalo's President and Chief Operating Officer, Duncan Chisholm, stated, "Once again, Union Bank of California is showing strong support for our achievements and our growth strategy. Mahalo has a significant inventory of drillable unconventional prospects and this support enhances our ability to exploit this asset base, sustain past performance and maintain our growth momentum. Our vision remains focused on growing our unconventional asset base in both Canada and the United States."

In addition, Peregrine Energy Ltd., a wholly-owned subsidiary of Mahalo, retains their $19.0 million credit facility with a $7.5 million development line of credit with the National Bank of Canada. On a combined basis, the Company has access to CDN $63.7 million in credit facilities.

About Mahalo

Mahalo is a junior oil and gas producer, primarily focused on the production and development of deeper Mannville coal bed methane deposits in western Canada and is successfully developing both coal bed methane and shale gas prospects in the United States. To find out more about Mahalo Energy Ltd., please go to Mahalo's profile on SEDAR at www.sedar.com or visit Mahalo's website and www.mahaloenergy.com

Certain information set forth in this document, including management's assessment of future plans and operations, contains forward-looking statements. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond each party's control, including the risks of successfully completing the proposed Arrangement, the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and ability to access sufficient capital from internal and external sources. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. Actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements, and accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits will be derived there from. Each disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required pursuant to applicable securities legislation.

The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Mahalo Energy Ltd.
    Gary Gardiner
    Chief Executive Officer
    (403) 451-3490
    or
    Mahalo Energy Ltd.
    Duncan Chisholm
    President and Chief Operating Officer
    (403) 716-3114
    or
    Mahalo Energy Ltd.
    Willie Dawidowski
    Vice-President, Finance and Chief Financial Officer
    (403) 451-3505
    or
    Mahalo Energy Ltd.
    201B, 218 - 8th Avenue SW
    Calgary, Alberta T2P 1B5
    (403) 262-9623
    (403) 262-7049 (FAX)
    Website: www.mahaloenergy.com