Shelton Canada Corp.

Shelton Canada Corp.

May 07, 2009 17:58 ET

Shelton Canada Corp. Summary of Year End 2008 Reserves

CALGARY, ALBERTA--(Marketwire - May 7, 2009) - Shelton Canada Corp. ("Shelton" or the "Company") (TSX VENTURE:STO) is pleased to provide its 2008 year end reserves information as evaluated by Trimble Engineering Associates Ltd. ("Trimble"), the independent reserves evaluator for all of Shelton's oil and natural gas properties. Trimble prepared the report (the "Shelton Trimble Report") in accordance with National Instrument 51-101 ("NI 51-101") effective December 31, 2008. Shelton will not file or announce its audited 2008 financial statement until on or about May 13, 2009 (see below for reasons), therefore, certain statements of a financial nature have been made herein to facilitate discussion of its 2008 capital program. Readers are advised that these financial estimates are subject to audit and may be revised as necessary.

2008 Highlights

- The Company's interest in total proved producing reserves increased 20% to 515.6 mboe.

- The Company's interest in total proved reserves increased 1% to 2.63 mm boe.

- The Company's interest in total proved plus probable reserves remained constant at approximately 7.9 mm boe.

- The Company spent $1.6 mm in developing the Lelyaki property in Ukraine during 2008 resulting in the addition of 205 mboe of proved producing reserves.

- Development costs for the Lelyaki property were $7.80 per boe of proved producing reserves.

- The before tax net present value (10% discount rate) of Shelton's proven plus probable reserves grew to $136.5 million, a 60% increase over year end 2007.

Zenon Potoczny, President, commented as follows:

"The Company has had a very good year for development and adding new projects. It has continued to develop the large in place reserves in the Lelyaki oil field through low risk development drilling. In addition it has been successful in adding the offshore Black Sea Arckchangelske Natural Gas Project to its portfolio. This project is currently going through the final approval process by Ukraine State regulatory bodies. Shelton plans on participating in a new 300 kilometer 2D seismic acquisition program over this structure in the summer of 2009."

Temporary Cease Trade Order

The company filed its reserve report prior to the filing deadline but was unable to complete the overall filing of its annual report for the year 2008 due to factors related to the physical delivery of the auditors' report. One item in the Joint Investment Agreement between Shelton and Ukrnafta needed to be clarified as to its materiality by the auditors. That information was requested of Ukrnafta, but due to holidays in Ukraine, receipt of the required information was delayed until May 5. The Ontario Securities Commission, Shelton's current prime regulator, when they were informed that the auditor was not going to deliver the audit report to the shareholder's until on or about May 13 deemed it appropriate to approve and issue a temporary cease trade order until such time as the financial statements are delivered. The company believes that no material issues exist in the disclosure to be filed within the next week and will ensure that next year's annual disclosure documents are prepared much earlier than is normal in most jurisdictions given the randomly occurring challenges of working in early stage emerging markets such as Ukraine.

Zenon Potoczny, President, has further commented as follows:

"The company continues to review various other financings to further its growth including co-listings on alternate foreign exchanges. Additionally the company is looking at opportunities to expand its operations into other jurisdictions in the vicinity of Ukraine in addition to focusing on the opportunities in and around the Crimean region of Ukraine. The company has made application to transfer its prime regulator from the Ontario Securities Commission to the Alberta Securities Commission."

About Shelton Canada Corp.:

Shelton Canada Corp. (, a Canadian-based junior oil and gas company, is focused on exploring and developing the resource-rich basins of Ukraine. The company has an internationally experienced board of directors and a long history of successful operations in Ukraine. These competitive advantages have helped Shelton to build effective personal relationships, strategic regional partnerships, and a large land position and a portfolio of projects on and offshore. Shelton's long-term goals are to become the leader in oil and gas production from the resource-rich Azov and Black Sea basins in five years.

Forward-Looking Information

Except for statements of historical fact relating to the company, this news release may contain certain "forward-looking information" within the meaning of applicable securities laws including opinions, assumptions, estimates and management's assessment of future plans and operations, budgeted capital expenditures and funding thereof, wells to be drilled, timing of drilling of wells and expected depths, budgeted cost of wells, commencement of production from wells and year-end production rate. Forward-looking information in this news release is characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate", and other similar words, or statements that certain events or conditions "may" "will" or "could" occur. There are uncertainties inherent in forward-looking information, including factors beyond Shelton's control, and no assurance can be given that such events will occur on time or at all. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements including, but not limited to, risks associated with oil and gas exploration, development, exploitation, results from testing, production, marketing and transportation, the volatility of oil and gas prices, currency fluctuations, the ability to implement corporate strategies, the state of domestic capital markets, the ability to obtain financing, incorrect assessment of the value of acquisitions, failure to realize the anticipated benefits of acquisitions, changes in oil and gas acquisition and drilling programs, delays resulting from inability to obtain required regulatory approvals, delays resulting from inability to obtain drilling rigs and other services, delays in tie-in-operations, results from testing, environmental risks, competition from other producers, imprecision of reserve estimates, changes in general economic conditions and other factors more fully described from time to time in the reports and filings made by Shelton with securities regulatory authorities. All of these risks are applicable to continued development and production from the Lelyaki Oil Field and further development of the North Kerchenskaya Project including the specific actions mentioned in this Press Release. Shelton undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change, except as required by law. The reader is cautioned not to place undue reliance on forward-looking statements. The risks and uncertainties set forth above are not exhaustive.

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.

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Contact Information

  • Shelton Canada Corp.
    Zenon Potoczny
    President & CEO
    (416) 252-4101