Nexstar Energy Ltd.

Nexstar Energy Ltd.

December 07, 2009 08:30 ET

Nexstar Energy Provides Update on Pembina Cardium Horizontal Wells

CALGARY, ALBERTA--(Marketwire - Dec. 7, 2009) - Nexstar Energy Ltd. (TSX VENTURE:NXE.A) (TSX VENTURE:NXE.B) ("Nexstar Energy" or the "Company") is pleased to report on developments with respect to its Cardium horizontal light oil exploration and development program in the Pembina area of west central Alberta. The Company has an inventory in excess of 40 Cardium horizontal drilling locations for future development. To date, the Company has participated in the drilling of 8 Pembina Cardium horizontal wells, all of which are expected to be on production in January, 2010.

West Pembina

The Company is also pleased to provide the initial test results from its 8-16-48-5 W5M Pembina Cardium horizontal oil well. The 8-16 well (0.25 net) is the first horizontal well drilled on the Company's West Pembina prospect lands. This well was drilled to a horizontal length of approximately 1,114 meters and was completed with an 11 stage frac treatment. During a three day test, the 8-16 well flowed frac oil and new oil at a controlled rate of approximately 850 bbls/day. Management expects the well to be placed on production within 30 days at an initial rate of between 200 to 300 bbls/day, which is similar to other Cardium horizontal oil wells in the Pembina area. Based on these results, the Company plans to participate in the drilling of up to four additional wells (1.0 net) offsetting this well in the first quarter of 2010. The first follow-up drilling location (0.25 net) has been licensed at 16-15-48-5 W5M for drilling in January, 2010.

East Pembina

The Company also announces that it is currently participating in the drilling of a Cardium horizontal development well (0.50 net) located at 8-3-48-3 W5M in the East Pembina area. This well commenced drilling on November 29, 2009 and is adjacent to several producing Cardium horizontal wells owned by third parties. As previously reported, the Company also has interests in four producing Cardium horizontal wells at East Pembina which are currently producing approximately 191 boepd net to the Company with two more wells (0.63 net) being tested and completed. Of the seven (7) East Pembina wells reported by the Company, six (6) are anticipated to be on production prior to year end.

Conversion of Class B Shares

The Company also announces, as previously reported, that the Class B Shares of the Company are being converted into Class A Shares effective December 11, 2009. Notices have been sent to all holders of Class B Shares with respect to the conversion. The Class B Shares will be delisted from trading on the TSX Venture Exchange at the close of market today. As previously announced, registered holders of Class B Shares are requested to deliver share certificates for Class B Shares to Olympia Trust Company ("Olympia") either by courier, registered mail or direct delivery and Olympia will deliver the new Class A Shares by first class mail. Shareholders registered with a brokerage or investment house, need not take any action as the Class A Shares will be issued automatically through the CDS system on December 11, 2009.

About Nexstar Energy

Nexstar Energy is an emerging junior oil and gas company focused on the horizontal drilling and development of its Cardium light oil prospects in the Pembina area of west central Alberta.

For further information, please go to Nexstar Energy's updated website.

Reader Advisory

This news release may contain certain forward-looking statements, which include assumptions with respect to (i) production; (ii) future capital expenditures; (iii) funds from operations; (iv) cash flow; and (v) debt levels. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect. All such forward-looking statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control. Such risks and uncertainties include, without limitation, risks associated with oil and natural gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, inability to retain drilling rigs and other services, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources, the impact of general economic conditions in Canada and the United States, industry conditions, changes in laws and regulations (including the adoption of new environmental laws and regulations) and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in foreign exchange or interest rates, stock market volatility and market valuations of companies with respect to announced transactions and the final valuations thereof, and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do, what benefits, including the amount of proceeds, the Company will derive therefrom. Readers are cautioned that the foregoing list of factors is not exhaustive. All subsequent forward-looking statements, whether written or oral, attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.

The terms bbls, bbls/d, boe, boes or boes/d may be misleading, particularly if used in isolation. A boe (barrel of oil equivalent) conversion ratio of 6 mcf per one (1) boe is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

110,811,169 Class A Shares

1,080,000 Class B Shares

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts 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