Point North Energy Ltd.

Point North Energy Ltd.

December 21, 2006 23:50 ET

Point North Energy Receives Extension in CCAA Process

CALGARY, ALBERTA--(CCNMatthews - Dec. 21, 2006) - Point North Energy Ltd. (TSX:PNY) ("Point North" or "the Corporation") announces that the provisions of the initial order granting protection under the Companies' Creditors Arrangement Act (originally reported on September 27, 2006) and the stay of proceedings in this action are extended until February 16, 2007.

As of December 20, 2006, Point North is in receipt of claims totalling $33 million under the CCAA process which closed on December 15, 2006. The Corporation is required by the order to determine the initial validity of each claim received by January 12, 2007. Currently, the company intends to dispute the validity of approximately $13.8 million worth of claims. If the current market conditions remain, and the balance of the outstanding claims are proved valid, management of Point North anticipates that the market value of assets in the company will be substantially less than the value of outstanding claims.

As of December 21, 2006, Point North Energy has not received any offers for its 24% working interest share in its property located at Ft. Liard, NT.

Management is continuing its efforts to restructure or recapitalize the company.

Forward Looking Statements

Information in this press release contains forward-looking statements including expectations of future production and components of cash flow and earnings. Investors are cautioned that assumptions used in the preparation of such information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of Point North Energy. These risks include, but are not limited to; the risks associated with the oil and gas industry, commodity prices and exchange rate changes. Industry related risks could include, but are not limited to; operational risks in exploration, development and production, delays or changes in plans, risks associated to the uncertainty of reserve estimates, health and safety risks and the uncertainty of estimates and projections of production, costs, expenses and working capital/liquidity. The risks outlined above should not be construed as exhaustive. Investors are cautioned not to place undue reliance on any forward-looking information. Point North Energy undertakes no obligation to update or revise any forward-looking statements.

Contact Information

  • Point North Energy Ltd.
    John Emery
    President & C.E.O
    (403) 269-5803
    (403) 264-1336 (FAX)
    Point North Energy Ltd.
    Doug Grabham
    Vice President Finance & CFO
    (403) 269-5803
    Website: www.pointnorthenergy.com