Redcliffe Exploration Inc.
TSX VENTURE : RXI.A
TSX VENTURE : RXI.B

Redcliffe Exploration Inc.

April 11, 2007 09:30 ET

Redcliffe Exploration Inc. ("Redcliffe") Provides Year-End Reserve Summary on a Pro-Forma basis for the Combination of Redcliffe Exploration Ltd. ("REX") and Stallion ("Stallion") Energy Ltd.

CALGARY, ALBERTA--(CCNMatthews - April 11, 2007) -

THIS NEWS RELEASE IS NOT FOR DISSEMINATION IN THE UNITED STATES OR TO U.S. PERSONS.

Redcliffe Exploration Inc. (TSX VENTURE:RXI.A)(TSX VENTURE:RXI.B) ("Redcliffe" or the "Company") was formed through a business combination, which closed on February 27, 2007, between Redcliffe Exploration Ltd. ("REX") and Stallion Energy Ltd. ("Stallion"), a private company. Under the business combination, REX became a wholly-owned subsidiary of Stallion, which was renamed Redcliffe Exploration Inc. For reporting purposes, the transaction was treated as a reverse takeover by REX of Stallion and, consequently, REX is considered the predecessor entity.

This report provides the 2006 year-end reserves summary for REX and Stallion effective December 31, 2006. These reserve estimates represent the pro-forma combination of Stallion and REX as if it had occurred at December 31, 2006 rather than the effective date of the business combination.

2006 year-end reserves summary

Following is a summary of the RXI reserves evaluation as of December 31, 2006, as prepared by McDaniel & Associates Consultants Ltd. ("McDaniel"), the Company's independent reserves evaluator.

In this news release, the Company's "interest before royalties" is the working interest reserves plus royalty interest reserves before deductions of royalty burdens. These reserve estimates and forecast of future cash flows have been prepared in accordance with National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities in Canada.

Reserves and production are stated in barrels of oil equivalent (boe) derived by converting gas to an oil equivalency in the ratio of six thousand cubic feet of gas to one barrel of oil. Boe may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet to one barrel (bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and may not represent a value equivalency at the wellhead.

Highlights of the reserve report:

- As a result of the business combination RXI has total proven reserves of 622,800 barrels of oil equivalent and proven plus probable reserves of 1,055,800 barrels of oil equivalent.

- The proved plus probable reserves consist of 78 percent natural gas and 22 percent light and medium crude oil and natural gas liquids.

- Based upon the McDaniel estimation of 2007 production levels RXI has a life index of 3.0 years on a proven basis and 4.5 years on a proven plus probable basis.

Summary of oil and natural gas reserves - company interest before tax and royalty

The McDaniel reserve report contains a high proportion of proved non-producing and probable reserves due to 2006 being the first partial year of operations for REX with new wells having no producing history. In addition, new wells drilled at year end on the Stallion properties also significantly impacted their reserve category allocation. Over time, management expects the relative proportion of proved producing reserves to increase.



DECEMBER 31, 2006, COMPANY INTEREST RESERVES SUMMARY

Light & Medium Natural Gas Natural Gas Total
Reserve category Crude (Mbbls) (Mmcf) Liquids (Mbbls) (Mboe)
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Proved Producing 11.0 1,067.6 28.2 217.1
Proved Non-
Producing 35.3 1,849.6 62.1 405.7
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Total Proved 46.4 2,917.2 90.2 622.8
Total Probable 31.1 2,014.9 66.1 433.0
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Total Proved +
Probable 77.5 4,932.1 156.3 1,055.8


Net Present Value of Reserves

Below is a table showing RXI's net present value of future net revenue attributable to reserves using McDaniel forecast prices as at January 1, 2007 and costs. The estimated future net revenues are presented before deducting future estimated site restoration costs, and are reduced for estimated future abandonment costs and future capital costs associated with non-producing, undeveloped and probable additional reserves. Estimated values disclosed do not necessarily represent fair market value.



SUMMARY OF FUTURE NET REVENUE BEFORE INCOME TAXES - AT DECEMBER 31, 2006
(in thousands of dollars)

Discounted at: Undiscounted 5% 10% 15%
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Total Proved 16,866.1 15,242.4 13,917.6 12,820.0
Total Probable 12,376.1 9,365.7 7,361.9 5,961.8
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Total Proved +
Probable 29,242.2 24,608.1 21,279.5 18,781.8


Undeveloped Land Evaluation

McDaniel also completed an independent evaluation of the Corporations undeveloped land. Redcliffe has a total of 27,579 acres of undeveloped land (10,249 net acres) 63% of which is located in the general Pembina area and 37% in the Peace River Arch area of Alberta. McDaniel appraised this net undeveloped acreage holdings at $3,223,064.

Redcliffe is a Calgary, Alberta based company engaged in the exploration for, and development and production of conventional crude oil and natural gas reserves in western Canada. The Company's strategy is to build shareholder value through internally generated exploration and development drilling, and through selective acquisitions. Redcliffe's areas of operational focus include the Pembina and Peace River Arch areas of Alberta.

Forward-Looking Statements: This news release contains certain forward-looking statements, including management's assessment of future plans and operations, and capital expenditures and the timing thereof, that 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 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, 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.

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 so, what benefits, including the amount of proceeds, that the Company will derive there from. Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could effect the Corporation's operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com).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. BOE may be misleading, particularly if used in isolation. A BOE conversion 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

  • Redcliffe Exploration Inc.
    Daryl H. Connolly
    President & CEO
    (403) 539-8440
    (403) 539-8433 (FAX)
    Email: dconnolly@redcliffe.ca
    or
    Redcliffe Exploration Inc.
    George Gramatke
    Vice President, Finance & CFO
    (403) 539-8442
    (403) 539-8433 (FAX)
    Email: ggramatke@redcliffe.ca