Nexstar Energy Ltd.

Nexstar Energy Ltd.

December 18, 2008 14:11 ET

Nexstar Energy Announces Exercise of Warrants and Operations Update

CALGARY, ALBERTA--(Marketwire - Dec. 18, 2008) -


Nexstar Energy Ltd. (TSX VENTURE:NXE.A) (TSX VENTURE:NXE.B) ("Nexstar Energy" or the "Company") announces that warrant holders have exercised Share Purchase Warrants (the "Warrants") to acquire 14,700,000 Flow-Through Class A Shares of the Company for gross proceeds of $735,000. Following the exercise of the Warrants, the Company has 27,732,869 Class A Shares, issued and outstanding. When combined with the funds raised by the Company in the previously announced private placement, the Company advises that an aggregate of $3,395,000 has been raised by the Company to date. Further, the Company has been advised that Warrants to acquire another 900,000 Flow-Through Class A Shares for gross proceeds of $45,000 are in the process of being exercised.

Operations Update

The Company has entered into a farm-in agreement with industry participants in the Pembina area of west-central Alberta. The Pembina prospect is considered by the Company to be ideal for the application of horizontal well drilling and multi-stage fracing technology. The initial horizontal well is currently drilling and is targeting light sweet crude oil in the Cardium formation at a depth of approximately 1,400 metres. The Company is participating for a 25% share of the costs of this well at a net cost of approximately $700,000. The well is being drilled on a farm-in block of six sections of undeveloped lands to earn a 31% working interest before payout in the drilled section and a 21% working interest after payout in the drilled section and one other section of the farm-in lands. The Company will have a rolling option to participate for a 31% share of the cost of additional wells on the unearned farm-in lands to earn an interest on similar terms. In addition, the Company has recently acquired a 25% working interest in four additional sections of undeveloped lands in the Pembina area on a separate Cardium oil prospect for future drilling.

About Nexstar Energy

Nexstar Energy is a newly reorganized junior oil and gas company that is focused on drilling multi-zone oil and natural gas prospects in western Canada, complemented by strategic acquisitions.

ADVISORY: This document contains forward-looking information that is based on expectations and estimates as of the date of this document. This forward-looking information is information that is subject to known and unknown risks and other factors that may cause future actions, conditions or events to differ materially from the anticipated actions, conditions or events expressed or implied by such forward-looking information. Forward-looking information is information that does not relate strictly to historical or current facts, and can be identified by the use of the future tense or other forward-looking words such as "proposed", "believe", "expect", "anticipate", "intend", "plan", "estimate", "should", "may", "objective", "projection", "forecast", "continue", "strategy", "position" or the negative of those terms or other variations of them or comparable terminology. Examples of such forward-looking information in this document include but are not limited to the following, each of which is subject to significant risks and uncertainties and is based on a number of assumptions which may prove to be incorrect. This forward-looking information represents the Company's views as of the date of this document and such information should not be relied upon as representing the Company's views as of any date subsequent to the date of this document. The Company has attempted to identify important factors that could cause actual results, performance or achievements to vary from those current expectations or estimates expressed or implied by the forward-looking information. However, there may be other factors that cause results, performance or achievements not to be as expected or estimated and that could cause actual results, performance or achievements to differ materially from current expectations. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those expected or estimated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. These factors are not intended to represent a complete list of factors that could affect the Company. Boes may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

27,732,869 Class A Shares

1,080,000 Class B Shares

The TSX Venture Exchange has neither approved nor disapproved the contents of this news release. The TSXV does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Nexstar Energy Ltd.
    Peter A. Carwardine
    President and CEO
    (403) 263-6133 ext. 201
    (403) 263-3629 (FAX)
    Nexstar Energy Ltd.
    Brian J. Spilchen
    VP Finance and CFO
    (403) 263-6133 ext. 202
    (403) 263-3629 (FAX)
    Nexstar Energy Ltd.
    603 - 7 Avenue SW, Suite 525
    Calgary, Alberta T2P 2T5