Stonefire Energy Corp.

Stonefire Energy Corp.

June 18, 2008 18:23 ET

Stonefire Energy Corp. Announces Commencement of Summer Drilling and Increased Credit Facilities

CALGARY, ALBERTA--(Marketwire - June 18, 2008) -


Stonefire Energy Corp. (TSX VENTURE:SFE.A) (TSX VENTURE:SFE.B)("Stonefire" or the "Company") is pleased to announce the commencement of its 4 well summer drilling program. The first well of the program spud on June 17, 2008 in the Company's core Edson area. All four wells planned for the summer drilling program are Stonefire operated and all are 100 percent working interest. The first two wells are targeting multiple deep basin gas zones in the Edson field with planned true vertical depths of approximately 2,350 meters. The third well, also in the Edson field, will target a light oil zone at a total vertical depth of 1,940 metres. These three Edson wells were planned using the Company's proprietary 3D seismic data and offset two successful multi-zone gas wells recently drilled by Stonefire. The Edson wells are in close proximity to Stonefire's 100 percent working interest gas gathering system and gas processing plant and require relatively short pipeline tie-ins. The fourth well planned for the summer is a 1,900 meter deep exploration well in the Leaman field targeting a high productivity deep basin gas zone and a light oil zone. Each well is expected to take 12 to 15 days to drill.

Stonefire is also pleased to announce that effective June 12, 2008, the Company's credit facilities with the National Bank of Canada were increased to a $17.0 million operating line from the previous $14.0 million combined operating and development line. 100 percent of the Company's production remains fully unhedged at this time and the Company is well positioned to fund its 2008 capital budget from cash flow and existing credit lines.

Stonefire Energy Corp. is an Alberta-based company formed to participate in oil and gas exploration, development and acquisitions focusing in the West Central region of Alberta. The Company's shares trade on the TSX Venture exchange under the symbols SFE.A and SFE.B. The Company currently has 18,265,000 Class A shares and 1,012,000 Class B shares outstanding.

Reader Advisory

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 Stonefire'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. Stonefire'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 Stonefire 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 Stonefire 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 Stonefire 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.

Petroleum and natural gas volumes are converted to an equivalent measurement basis referred to as a "barrel of oil equivalent" (boe) on the basis of 6 thousand cubic feet of natural gas equalling 1 barrel of oil. This is based on an energy equivalency conversion method applicable at the burner tip and does not necessarily represent a value equivalency at the wellhead. Readers are cautioned that boe figures may be misleading, particularly if used in isolation.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this statement.

Contact Information

  • Stonefire Energy Corp.
    Mr. Richard Dahl
    President & Chief Executive Officer
    (403) 262-9885 ext 222
    (403) 262-9887 (FAX)
    Stonefire Energy Corp.
    Mr. Ronald Williams
    Vice President Finance and CFO
    (403) 262-9885 ext 228
    (403) 262-9887 (FAX)