Painted Pony Petroleum Ltd.

Painted Pony Petroleum Ltd.

March 18, 2008 21:15 ET

Painted Pony Announces Strategic $20.8 Million Production and Land Acquisition in Core NE BC Area

CALGARY, ALBERTA--(Marketwire - March 18, 2008) -


Painted Pony Petroleum Ltd. ("Painted Pony" or the "Company") (TSX VENTURE:PPY.A)(TSX VENTURE:PPY.B) is pleased to announce that it has entered into an agreement with Crescent Point Energy Trust ("Crescent Point") to acquire certain natural gas properties focused in the multi-zone gas-prone Cameron River/ Blair fairway in northeast British Columbia (the "Assets"). The consideration for the acquisition consists of 4,110,000 Class A common shares of Painted Pony issued at a deemed price of $4.33 per share and approximately $3.0 million cash, for a total purchase price of $20.8 million, before closing adjustments and related costs. The shares will be issued to Crescent Point and are subject to certain terms, restrictions and conditions until March 31, 2009. The acquisition has an effective date of February 1, 2008 and an expected closing date of March 31, 2008. The completion of the acquisition is subject to certain conditions including normal regulatory approvals, including approval of the TSX Venture Exchange. In connection with the acquisition of the Assets, Painted Pony is having a reserve report prepared in accordance with National Instrument 51-101, which will be filed with the TSX Venture Exchange prior to closing.

Current production from the acquired properties is estimated to be approximately 450 Boe/d, consisting of 20 Bbls/d of natural gas liquids and 2,580 Mcf/d of natural gas, based on field estimates. The Assets include 73,339 net acres of undeveloped lands. A significant portion of the Assets will be operated by Painted Pony.

The Assets are located in the Company's northeast British Columbia core area, where Painted Pony has access to 1,200 km2 of three dimensional seismic through an area of mutual interest agreement. Painted Pony will continue to evaluate the acquisition asset base for potential exploration, development and exploitation opportunities.

Pat Ward, President and CEO comments, "Our technical team and I are very familiar with many of these Assets, having actively explored for gas in this fairway with prior employers. We believe this acquisition contains very attractive opportunities, including the potential application of new technology, and complements our existing high netback Saskatchewan Bakken light oil properties. Our commitment to organic growth has not changed."

Investor Information

Painted Pony is a junior Canadian oil and gas exploration company that trades on the TSX Venture Exchange under the symbols "PPY.A" and "PPY.B" respectively. Painted Pony currently has 15,282,700 Class A shares, 1,173,600 Class B shares and 1,347,000 options issued and outstanding. Upon closing of this acquisition, Painted Pony will have 19,392,700 Class A shares issued and outstanding.

For further information, please see


This news release contains certain forward-looking statements, which include assumptions with respect to (I) drilling success (ii) production; (iii) future capital expenditures; and (iv) cash flow. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect.

Certain information regarding Painted Pony set forth in this document, including management's assessment of Painted Pony's future plans and operations, number, type and timing of wells to be drilled, the plan and development of certain prospects, production estimates, undeveloped land holdings, and expected production growth may constitute forward-looking statements under applicable securities laws and necessarily involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond Painted Pony's control, including without limitation, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, environmental risks, competition, the lack of availability of qualified personnel or management, inability to obtain drilling rigs or other services, capital expenditure costs, including drilling, completion and facility costs, unexpected decline rates in wells, wells not performing as expected, stock market volatility, 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, the United States and overseas, 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. Readers are cautioned that the foregoing list of factors is not exhaustive. Painted Pony's 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, including the amount of proceeds, that the Corporation 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 Corporation or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements.

Additional information on these and other factors that could affect Painted Pony's operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website ( or Painted Pony's website (

The forward-looking statements contained in this document are made as at the date of this news release and Painted Pony 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.

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.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.

Contact Information

  • Painted Pony Petroleum Ltd.
    Patrick R. Ward
    President & CEO
    (403) 475-0440
    Painted Pony Petroleum Ltd.
    Joan E. Dunne
    Vice President, Finance & CFO
    (403) 475-0440
    Painted Pony Petroleum Ltd.
    402, 620 - 12 Ave SW
    Calgary, AB T2R 0H5
    (403) 475-0440
    (403) 238-1487 (FAX)