Southern Pacific Resource Corp.
TSX VENTURE : STP

Southern Pacific Resource Corp.

November 22, 2006 16:10 ET

Southern Pacific Closes Acquisition of Oil Sands Assets and $10,000,000 Offering

CALGARY, ALBERTA--(CCNMatthews - Nov. 22, 2006) - Southern Pacific Resource Corp. (TSX VENTURE:STP) ("Southern Pacific" or the "Corporation") is pleased to announce that it has closed the acquisition of 80% of Bounty Developments Ltd.'s ("Bounty") interest in its Leismer South Oil Sands Assets as originally announced on September 10, 2006 and September 28, 2006 (the "Acquisition"). Bounty and Southern Pacific are now joint venture partners for the development of the Leismer South Oil Sands Assets, which are comprised of 25 contiguous sections in Townships 75-76, Rge. 10 W4M.

The Corporation wishes to announce that it has closed two previously announced private placements. The Corporation closed its private placement of 14,000,000 of subscription receipts at a price of $0.50 per subscription receipt. Upon closing the Acquisition, an aggregate of 14,000,000 Units were issued upon conversion of the subscription receipts. Each Unit is comprised of one common share ("Common Share") and one half of one common share purchase warrant ("Warrant"). Each Warrant entitles the holder to acquire one Common Share at a price $0.75 per Common Share until November 22, 2007.

The Corporation has also closed its previously announced private placement of flow-through Units. An aggregate of 5,454,545 flow-through Units at a price of $0.55 per Unit were issued for gross proceeds of $3,000,000. Each Unit is comprised of one Common Share (issued on a flow through basis) and one half of one regular common share purchase Warrant. Each Warrant entitles the holder to acquire one Common Share at a price $0.80 per Common Share until November 22, 2007.

A cash commission in the amount of $312,720 was paid to eligible parties in connection with the private placements.

The total of the two placements generated gross proceeds for the Corporation of $10,000,000. These proceeds were used for payment of the purchase price for the Acquisition, and will be used for the completion of evaluation and development drilling, of the seismic, and for general working capital purposes.

In connection with the Acquisition, the Corporation paid cash consideration of $5,752,235 and issued 6,000,000 Common Shares to Bounty. As a result of the Acquisition, Bounty of Calgary, Alberta, now holds 6,000,000 Common Shares (16.8%). All of these 6,000,000 Common Shares are being held in escrow in accordance with TSX Venture Exchange policy. The Corporation also issued 400,000 Common Shares to arm's length parties as a finder's fee in connection with the Acquisition. The securities issued in connection with the private placement, finder's fee and Acquisition are subject to a four month statutory resale restriction.

The Corporation has also issued 2,475,000 options to purchase Common Shares to eligible participants, of which 2,100,000 were granted to officers and directors of the Corporation. The options to purchase Common Shares are exercisable at a price of $0.50 per Common Share for five years from the date of issuance. The stock option grant is subject to regulatory approval. The Corporation has determined that exemptions from the various requirements of TSX Venture Exchange Policy 5.9 are available for the grant of options.

OPERATIONS UPDATE

In anticipation of this closing, and to ensure the Corporation was able to carry out its planned winter exploration program, Southern Pacific has begun the necessary regulatory approval and local consultation process for drilling of up to 12 vertical exploration wells and the scheduled seismic program. The drilling and seismic program is expected to be completed during the 1st quarter of 2007. This program will enable the Corporation to establish its further delineation and development initiatives.

After giving effect to the Acquisition, Private Placements and related transactions, the Corporation now has 35,681,556 Common Shares issued and outstanding.

At the shareholders meeting held on November 17, 2006, all matters placed before the shareholders were approved including the discontinuance of the Corporation from the Province of British Columbia and the continuance the Corporation into the Province of Alberta and the election of new directors. The new directors and management are Arun K. Dey (Director and President), David M. Antony (Director and CFO), Jon P. Clark (Director), Tibor Fekete (Director), J. Ward Mallabone (Director) and Trevor P. Wong-Chor (Corporate Secretary). Biographies for these individuals are contained the Management Information Circular of the Corporation dated October 20, 2006.

The TSX Venture Exchange has neither approved of disapproved the contents of this press release.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

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