Superior Canadian Resources Inc.

Superior Canadian Resources Inc.

November 27, 2006 16:07 ET

Superior Announces Update to Certain Oil & Gas Acquisitions

CALGARY, ALBERTA--(CCNMatthews - Nov. 27, 2006) - Superior Canadian Resources Inc. (TSX VENTURE:CAD), (the "Company") is issuing this release in an effort to clarify certain transactions previously announced by the Company.

In the news release dated June 20, 2005, the Company announced the acquisition, through its 100% owned subsidiary Koro Energy USA Inc. ("Koro USA"), of a 25% working interest in 1,100 acres of prospective oil & gas properties in Montana. The press release should have stated that the Company acquired a 25% working interest in 1,200.85 acres. The 25% working interest was purchased at a United States Department of Interior Bureau of Land Management ("BLM") public auction sale. On October 18, 2005, the Company announced the acquisition of a further 25% working interest in a 640 acre parcel at a State of Montana public oil & gas sale. The total acreage purchased at both public land sales was 1,840.85 acres, in which Koro USA currently holds a 25% working interest.

The Company's partner in these two public land sale purchases is Sonalta Resources Inc. ("Sonalta"), a non-arms length company that has been active in Montana since December 2002. Sonalta, a privately held US corporation, has a common officer and director with the Company since April 2004. Additionally, two directors of the Company have held a minority shareholder interest in Sonalta since December 2004.

Further to the Company's press release of September 6, 2005, announcing the Letter of Intent, the Company, advises that the non-arm's length party is Sonalta. The Letter of Intent relates to the proposed acquisition of a further 25% working interest in the lands purchased by Sonalta at the land sales noted above, which would give the Company a 50% working interest in the aggregate 1,840.58 acre package. This Letter of Intent also includes the additional proposed acquisition from Sonalta of a 25% working interest in a separate land package comprising 1,460.39 acres of both freehold and BLM mineral leases.

Upon completion of the proposed acquisition, which is subject to Shareholder and TSX-Venture Exchange approval, the Company will hold working interests in 3,301.49 acres of oil and gas mineral lands as broken down above. This includes two tied-in gas wells, which the Company would have a 25% working interest in, that are expected to be brought on-line concurrently with the commissioning of the gathering line and compression facility anticipated to be completed by the end November of this year.

The acquisition, with Sonalta, is considered to be a 'Fundamental Acquisition', as defined by TSX Venture Exchange policy, and is required to be resubmitted to the shareholders for their approval at the next annual general meeting, the date of which will be announced in a subsequent news release. Shareholders will receive further detail and information concerning the proposed Montana acquisition in the Information Circular to be prepared by management in connection with this next annual general meeting, including disclosure of summary information from a National Instrument 51-101 compliant independent engineering report, which has been filed with the TSX Venture Exchange for review pursuant to the Company's August 2, 2006 press release.

We further advise that no further negotiations as to pooling of additional lands in Montana, as announced, in the press release of September 6, 2005 are on-going.

The Michigan acquisition as announced in the July 31, 2006 press release is continuing to proceed as management has recently received a draft purchase and sale agreement for review and comment.

Shares issued & outstanding: 16,970,468

The TSX Venture Exchange has reviewed this press release and does accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Superior Canadian Resources Inc.
    David Sim
    (403) 232-8555
    Superior Canadian Resources Inc
    Jeff Shier
    (416) 550-9857
    (403) 262-1169 (FAX)