Redcliffe Exploration Inc.

Redcliffe Exploration Inc.

September 25, 2007 10:57 ET

Redcliffe Initiates Fall Drilling Program, Updates Production Tie-Ins and Recent Acquisition Announcement

CALGARY, ALBERTA--(Marketwire - Sept. 25, 2007) -


Redcliffe Exploration Inc. (TSX VENTURE:RXI.A) (TSX VENTURE:RXI.B) ("Redcliffe" or the "Company") provides the following activity update:

Drilling Program

Redcliffe is pleased to announce the initiation of its fall drilling program, pursuant to which the Company expects to drill a minimum of 7 wells, 4 in the Pembina area and 3 on the Gold Creek property prior to year-end. At Pembina, Redcliffe will operate the drilling of 4 wells as the first step in our 6 well commitment within the previously announced 110 section block farm-in, offsetting existing successful gas wells at Crystal and our existing Pembina acreage. These wells will target multi-zone, liquid-rich gas up to 2100 meters in depth. The first well is scheduled to commence drilling during the first week of October. In addition, Redcliffe also intends to commence the completion and testing of 4 existing wells in this area. Redcliffe is also pleased to announce that it has recently agreed to acquire a major interest in a gas processing facility in the area to facilitate anticipated production growth. As such, success in this area will translate into production increases this winter.

In the Peace River Arch area of northwestern Alberta the Company will participate in 3 wells in Gold Creek following up the two major gas/liquids discoveries made in late 2006. This drilling is expected to commence by mid October and will correspond with the expansion of the compression and transportation facilities in the area that are scheduled for completion by the end of November. This expansion will facilitate existing and future well tie-ins in this liquids-rich gas play. Redcliffe also holds an extensive inventory of developmental and exploratory drilling locations, which will be evaluated in 2008.

In addition to this activity, Redcliffe is currently participating in the completion operations on two wells drilled this summer at Garrington 4-4 and Wapiti 9-3. Both completion operations have been slowed by weather conditions.

Production Tie-ins

Over the course of 2007 Redcliffe has been negatively impacted by delays in bringing production on stream due primarily to third party plant and transportation issues. Redcliffe's current production is approximately 500 boepd (2,400 mcfpd and 100 bpd of oil and natural gas liquids). Two gas wells and one oil well in Pembina are scheduled for tie-in over the next two weeks, which are expected to add approximately 80 boepd of initial net production. In addition, the testing and tie-in of up to 4 wells in the Pembina farm-in area along with the two wells currently undergoing completion and testing operations in Wapiti and Garrington, may add to those expected production totals in the fourth quarter. The anticipated Gold Creek gas and liquids production increases await the completion of the facility expansion in November and will be supplemented by a current 190 boepd awaiting tie-in and any drilling success achieved with our winter 3 well drilling program.

Redcliffe Energy Ltd. Acquisition

Redcliffe announced a proposal on August 9, 2007 for the acquisition through a share exchange of all the shares of Redcliffe Energy Ltd. ("Redcliffe Energy") a related private company. Both companies have engaged financial advisors to assist in the valuation of the proposed business combination and a formal agreement is expected to be executed shortly. Subsequent regulatory and shareholder approvals will be sought with closing anticipated in late November. Redcliffe Energy currently produces approximately 150 boepd (475 mcfpd and 70 bpd oil and natural gas liquids) with a further 150 boepd awaiting tie-in.

Redcliffe's strategy is to build shareholder value through internally generated exploration and development drilling, and through selective acquisitions. Redcliffe explores for liquid-rich, multi- zone gas at depths of 1500 - 2800 meters in the Pembina and Peace River Arch areas of western Alberta.

Forward-Looking Statements: This news release contains certain forward-looking statements, which include assumptions with respect to production and future capital expenditures. 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 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, that the Company will derive there from. 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. In addition, the term "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 necessarily 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)
    Redcliffe Exploration Inc.
    George Gramatke
    Vice President, Finance & CFO
    (403) 539-8442
    (403) 539-8433 (FAX)