Mountainview Energy Ltd.

February 24, 2011 22:35 ET

Mountainview Announces Private Placement for Proceeds of Up to $2.5 Million and Update on Acquisition of Bakken Assets

CUT BANK, MONTANA--(Marketwire - Feb. 24, 2011) -


Private Placement

Mountainview Energy Ltd. ("Mountainview" or the "Company") (TSX VENTURE:MVW) is pleased to announce that it intends to undertake a non-brokered equity private placement (the "Private Placement") of up to 2,777,778 units ("Units") of the Company at a price of $0.90 per Unit for aggregate gross proceeds of up to approximately $2.5 million. Each Unit shall consist of one common share of the Company (each a "Common Share") and one-quarter of one Common Share purchase warrant (each whole such warrant a "Warrant"), with each whole Warrant entitling the holder thereof to acquire one Common Share at a price of $1.12 per Common Share for a period of one year following the closing of the Private Placement. The securities comprising the Units to be issued under the Private Placement will be issued pursuant to exemptions from the prospectus requirements of applicable securities laws and will be subject to the resale restrictions prescribed under applicable securities laws. Up to an additional 694,445 Common Shares will be reserved for future issuance pursuant to the exercise of the Warrants issued pursuant to the Private Placement. The Private Placement is expected to close in early March, 2011 and shall be subject to receipt of regulatory and TSX Venture Exchange (the "Exchange") approvals. It is expected that insiders of the Company will subscribe for approximately 25% of the Units pursuant to the Private Placement.

The proceeds of the Private Placement will be used: (i) to further Mountainview's exploration and early development programs in the Bakken and Three Forks Shale in the Williston Basin and the South Alberta Bakken play; (ii) for future corporate and asset acquisition and farm-in opportunities; and (iii) for general corporate purposes.

Update on Acquisition of Bakken Assets

Further to the Company's news release dated October 28, 2010, the Company has agreed to acquire the undivided interests in approximately 57,000 acres of producing and non-producing oil and gas leaseholds in the Williams and Lake Frances areas of Pondera County, Montana from Altamont Oil & Gas, Inc. ("Altamont"), Numbers, Inc. ("Numbers") and DBD Investments, Inc. ("DBD"). In consideration, the Company will issue: 7,825,696 Common Shares to Altamont; 4,491,056 Common Shares to Numbers; and 615,750 Common Shares to DBD (collectively, the "Transaction Shares"). The Transaction Shares will be issued at a deemed price of $0.44 per share.

In connection with the foregoing, the Company has agreed to acquire a compressor plant, ancillary equipment, field wellhead equipment and pipelines from Genesis Energy, Inc. ("Genesis") in the Williams and Lake Frances gas fields in Pondera County, Montana. In consideration, the Company will pay $283,000 in cash and issue a debenture in the amount of $1,100,000 convertible into Common Shares at a price of $2.50 per share.

Altamont and Genesis are both private companies either wholly or majority-owned and/or managed by Mr. Patrick M. Montalban, a director, senior officer and shareholder of the Company. Accordingly, the transactions will be considered "related party transactions" under the policies of the Exchange. Completion of these acquisitions will require disinterested shareholder approval and Exchange approval. 

Information about the Company

Mountainview Energy Ltd. is a public oil and gas company listed on the Exchange, with a primary focus on the exploration, production and development of the Bakken and Three Forks Shale in the Williston Basin and the South Alberta Bakken play.

Forward Looking Statements

This press release contains forward looking statements. More particularly, this press release contains statements concerning the anticipated closing date of the Private Placement, certain expected subscribers of the Private Placement, the use of proceeds from the Private Placement and certain matters related to the asset acquisitions referenced herein . Although Mountainview believes that the expectations reflected in these forward looking statements are reasonable, undue reliance should not be placed on them because Mountainview can give no assurance that they will prove to be correct. Since forward looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. The closing of the Private Placement could be delayed if Mountainview is not able to obtain the necessary regulatory and stock exchange approvals on the timelines it has planned. The Private Placement will not be completed at all if these approvals are not obtained or some other condition to the closing is not satisfied. Accordingly, there is a risk that the Private Placement will not be completed within the anticipated time or at all.

The forward looking statements contained in this press release are made as of the date hereof and Mountainview undertakes no obligations to update publicly or revise any forward looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities in the United States of America. The securities of the Company have not been and will not be registered under the United States Securities Act of 1933 (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons (as defined in the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws, or an exemption from such registration is available.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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