Xtreme Coil Announces $50.35 Million Bought Deal Offering

CALGARY, ALBERTA--(Marketwire - May 11, 2011) -

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Xtreme Coil Drilling Corp. ("Xtreme Coil" or the "Company") (TSX:XDC) announced that it has entered into an agreement with a syndicate of underwriters led by Peters & Co. Limited, and including Global Hunter Securities, LLC, Cormark Securities Inc. and Canaccord Genuity Corp. (the "Underwriters"), pursuant to which the Underwriters have agreed to purchase, on a bought deal basis, 10,600,000 common shares ("Common Shares") of Xtreme Coil at a price of $4.75 per Common Share for aggregate gross proceeds of $50,350,000. The Underwriters will have the option to purchase up to an additional 15 percent of the total issue of Common Shares, exercisable in whole or in part at the sole discretion of the Underwriters up to 30 days after the closing date, at the same issue price, to cover over allotments, if any. If such option is exercised in full, the aggregate gross proceeds of the offering will be $57,902,500. The Common Shares will be offered in British Columbia, Alberta, Saskatchewan, Manitoba and Ontario by way of a short form prospectus and in the U.S. on a private placement basis pursuant to exemptions from registration requirements.

Net proceeds of the offering will be used initially to reduce indebtedness, and thereafter drawn to partially fund an increased 2011/2012 capital expenditure program (more specifically to construct a minimum of two XDR 500 drilling rigs) and for general corporate purposes.

About Xtreme Coil

Xtreme Coil owns and operates a fleet of proprietary, dual-purpose deep capacity drilling rigs featuring the Company's patented COTD® designs. These rigs offer oil and gas companies outstanding performance and efficiency through leading-edge technology for both conventional and coil drilling. Currently, 14 rigs are located in the United States, with drilling operations in Colorado, North Dakota, Texas, Wyoming and Mississippi. Two deep coil service rigs are conducting re-entry horizontal drilling operations in Saudi Arabia. Xtreme Coil is expanding deep coil well servicing operations and has six units undergoing technical upgrades with expected deployment beginning during 2011 fourth quarter. Xtreme Coil's common shares trade on the Toronto Stock Exchange under the symbol "XDC."

Reader Advisory

This press release contains forwarding looking statements. More particularly, this press release contains statements concerning the anticipated use of the net proceeds of the offering. Although the Company believes that the expectations reflected in these forward looking statements are reasonable, undue reliance should not be placed on them because the Company can give no assurance that they will prove to be correct. Since forward looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. The intended use of the net proceeds of the offering by the Company might change if the board of directors of the Company determines that it would be in the best interests of the Company to deploy the proceeds for some other purpose.

The forward looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligations to update publicly or revise any forward looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.