RMP Energy Inc.

RMP Energy Inc.

March 01, 2012 16:47 ET

RMP Energy Announces Waskahigan Land Expansion and Resthaven Land Disposition

CALGARY, ALBERTA--(Marketwire - March 1, 2012) - RMP Energy Inc. ("RMP" or the "Company") (TSX:RMP) is pleased to announce that the Company continued the expansion of its Waskahigan area light oil resource-play through an agreement to acquire a 70% working interest in 7,840 contiguous acres of undeveloped land (5,488 net acres), including the Montney mineral rights but excluding the deep rights, from an arm's-length party for $8.5 million. The acquisition is subject to certain customary conditions. The land is located to the south east of RMP's existing Waskahigan asset base in West Central Alberta. The purchase is scheduled to close on or about April 2, 2012.

With existing well control on and surrounding the acreage to be acquired, RMP has identified up to 40 Montney light oil drilling locations. The purchase will be funded through the disposition of RMP's undeveloped acreage at Resthaven/Bilbo, discussed hereafter. Following the closing of the purchase, the Company will hold a significant position in the Triassic Montney oil fairway, encompassing a total of 39,200 acres (36,848 net acres) of prospective acreage at Waskahigan and Ante Creek, providing for a potential crude oil drilling inventory in excess of 160 high working interest, operated locations anticipated to provide strong crude oil growth over many years.

The Company has also executed an agreement to dispose of its non-core, undeveloped land rights at Resthaven/Bilbo to an arm's-length party for $15.0 million, subject to certain customary conditions. Closing of this sale is anticipated to occur by the end of the first quarter. This disposition involves the sale of RMP's undeveloped, non-producing 100% working interest rights in 24,480 acres located in the Resthaven/Bilbo area of West Central Alberta. The proceeds from this disposition will be used to reduce outstanding borrowings under the Company's bank credit facility and fund the strategic land purchase in Waskahigan.

RMP is very pleased to identify and execute an opportunity to significantly expand its acreage position and crude oil drilling inventory in the Waskahigan area along the prolific Montney light oil fairway, and in conjunction fund the purchase with the disposition of its non-core, undeveloped lands at Resthaven/Bilbo wherein no capital activity was planned for the foreseeable future.

Reader Advisories

The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "budget", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. More particularly and without limitation, this news release contains forward-looking information relating to: closing dates of the acquisition and disposition land transactions and crude oil drilling locations inventory. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; 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; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry ; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such 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 that the Company will derive from them. The Company's forward-looking statements are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements.

In this news release, reserves and production data are commonly stated in barrels of oil equivalent ("boe") using a six to one conversion ratio when converting thousands of cubic feet of natural gas ("mcf") to barrels of oil ("bbl") and a one to one conversion ratio for natural gas liquids ("NGLs"). Such conversion may be misleading, particularly if used in isolation. A boe conversion ratio of 6 mcf: 1 bbl is based on energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

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