Trafalgar Energy Ltd.
TSX : TFL

Trafalgar Energy Ltd.

April 29, 2009 18:00 ET

Trafalgar Energy Ltd. Establishes New Credit Facility and Provides Operational Update

CALGARY, ALBERTA--(Marketwire - April 29, 2009) - Trafalgar Energy Ltd. ("Trafalgar" or the "Company") (TSX:TFL) is pleased to announce that it has entered into an agreement with ATB Financial ("ATB") for the provision of an $18 million revolving demand loan facility. The ATB facility is subject to periodic borrowing base redetermination based upon annual independent engineering reports. The next borrowing base redetermination is scheduled for April 30, 2010. The ATB facility replaces Trafalgar's existing $18 million credit facility with its current lender. Net debt as at March 31, 2009 is estimated to be approximately $12.7 million, consistent with the Company's year end 2008 net debt position.

Operational Update

At Cypress B.C., the B-65-C farmout well has reached total depth. A multi-stage completion operation targeting natural gas in the Montney formation is scheduled for June 2009. The B-65-C well is located approximately 200 meters from existing underutilized pipeline infrastructure which is 100% owned and operated by Trafalgar. We look forward to reporting completion results this summer.

The Cypress farmout has the potential to provide Trafalgar with material additional northeast British Columbia natural gas exposure at no capital cost. Discussions with the operator are ongoing with respect to timing and scope of potential additional earning activity. Trafalgar owns approximately 33,600 gross acres (14,800 net) of undeveloped Montney rights at Cypress with an average 44% working interest. Subsequent to the potential completion of a multi-well drilling program, Trafalgar will retain an 8 to 10% working interest in the Montney rights at Cypress.

During the fourth quarter of 2008, Trafalgar established a new light oil producing area at House Mountain Alberta. Trafalgar significantly expanded its 100% working interest land position at House Mountain to approximately 16,000 net undeveloped acres during the first four months of 2009. The Company now has 10 light oil drilling locations in inventory at House Mountain. The majority of these locations are drill-ready, accessible all year and have the potential to be highly economic at today's prices, particularly in light of the recently announced Alberta royalty incentives.

Trafalgar's first House Mountain well was brought on production in November of 2008 at rates exceeding 250 bbls per day of light oil with less than 10% water cut. During the first quarter of 2009, the 3-36 well stabilized at approximately 140 bbls per day with water cuts remaining at less than 10%. Current production from the 3-36 well is rate restricted to approximately 80 bbls per day in compliance with government rate limitations. Trafalgar is planning to commence development drilling at House Mountain in the third quarter of 2009.

The Company continues to build land positions on oil focused projects in Alberta and Saskatchewan. Low land prices are providing an excellent opportunity to acquire strategic positions at a substantially lower cost than recent years. Trafalgar views this as an opportunity to grow drilling inventory and position the Company for the next upswing in energy prices.

Production for the first quarter 2009 is estimated to have averaged 1,025 to 1,050 boe per day.

BOE Presentation

In conformity with National Instrument 51-101, Standards for Disclosure of Oil and Gas Activities ("NI 51-101"), natural gas volumes have been converted to barrels of oil equivalent ("boe") using a conversion rate of six thousand cubic feet of natural gas to one barrel of oil. This ratio is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Readers are cautioned that the term "boe" may be misleading, particularly if used in isolation.

Forward-Looking Statements

This press release contains certain forward-looking statements and forward-looking information (collectively referred to herein as "forward-looking statements") within the meaning of applicable Canadian securities laws. All statements other than statements of present or historical fact are forward-looking statements. Forward-looking information is often, but not always, identified by the use of words such as "anticipate", "believe", "plan", "intend", "objective", "continuous", "ongoing", "estimate", "expect", "may", "will", "project", "should", or similar words suggesting future outcomes. In particular, this press release contains forward-looking statements relating to:

- estimated net debt levels;

- estimated average production;

- timing of borrowing base redeterminations;

- timing and likelihood of completion and testing operations;

- Alberta royalty incentives;

- Trafalgar's business strategy and plans;

- future development and growth opportunities;

- Trafalgar's existing asset base and future prospects;

- exploration, drilling and development plans, and the timing of and results therefrom;

- anticipated land costs and availability;

- industry conditions including anticipated commodity prices.

Forward-looking statements regarding Trafalgar are based on certain key expectations and assumptions of Trafalgar concerning anticipated financial performance, business prospects, strategies, regulatory developments, current commodity prices and exchange rates, applicable royalty rates, tax laws, future well production rates and reserve volumes, future operating costs, the performance of existing wells, the success of its exploration and development activities, the sufficiency and timing of budgeted capital expenditures in carrying out planned activities, the availability and cost of labor and services, the impact of increasing competition, conditions in general economic and financial markets, availability of drilling and related equipment, effects of regulation by governmental agencies, the ability to obtain financing on acceptable terms which are subject to change based on commodity prices, market conditions, drilling success and potential timing delays.

These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond Trafalgar's control, including the impact of general economic conditions; volatility in market prices for crude oil and natural gas; industry conditions; currency fluctuation; imprecision of reserve estimates; liabilities inherent in crude oil and natural gas 6 operations; environmental risks; incorrect assessments of the value of acquisitions and exploration and development programs; competition from other producers; the lack of availability of qualified personnel or management; changes in income tax laws or changes in royalty rates and incentive programs relating to the oil and gas industry; hazards such as fire, explosion, blowouts, cratering, and spills, each of which could result in substantial damage to wells, production facilities, other property and the environment or in personal injury; stock market volatility; and ability to access sufficient capital from internal and external sources.

Management has included the above summary of assumptions and risks related to forward-looking information provided in this press release in order to provide readers with a more complete perspective on Trafalgar's future operations and such information may not be appropriate for other purposes. Trafalgar's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance 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 that Trafalgar will derive there from. Readers are cautioned that the foregoing lists of factors are not exhaustive. These forward-looking statements are made as of the date of this press release and Trafalgar disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws. However, in the event that subsequent events are reasonably likely to cause actual results to differ materially from material forward-looking information previously disclosed by Trafalgar for a period that is not yet complete, Trafalgar will provide disclosure on such events and the anticipated impact of such events. Additional information regarding Trafalgar including its annual information form is available under the Company's profile at www.sedar.com or the Company's web site at www.trafalgarenergy.ca.

Trafalgar is a growth oriented, junior oil and natural gas exploration, development and production company operating exclusively in western Canada. Trafalgar's common shares are publicly traded on the Toronto Stock Exchange under the trading symbol "TFL".

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