/NOT FOR DISSEMINATION IN THE UNITED STATES OR OVER UNITED STATES WIRE
SERVICES/
CALGARY, Nov. 29 /CNW/ - Breaker Energy Ltd. (TSX:WAV.A and WAV.B) ("Breaker" or the "Company") is pleased to announce that it has completed the previously announced bought deal private placement of 800,000 Class A shares issued on a "flow-through" basis (the "Flow-Through Shares") at an issue price at $6.90 each for aggregate gross proceeds of $5,520,000. The hold period on these shares expires on March 30, 2008. The shares were issued through a syndicate of underwriters led by FirstEnergy Capital Corp. and including Tristone Capital Inc., Blackmont Capital Inc., Dundee Securities Corporation, Wellington West Capital Markets Inc., BMO Capital Markets and Scotia Capital Inc.
Gross proceeds from the sale of the Flow-Through Shares will be used to fund ongoing exploration activities eligible for Canadian exploration expenses which will be renounced in favour of the subscribers of the Flow-Through Shares effective on or before December 31, 2007.
Breaker has expanded its 2007 capital program by an additional $7.5 million to a total of $67.5 million, with an increased focus on high-netback light oil projects at Irricana and Girouxville. At Breaker's large light oil pool in Irricana, funds will be used to accelerate drilling new horizontal wells, and to recomplete existing horizontal wells with multiple fracture technology. As announced November 7th, Breaker has had significant success in this pool, with its first two new wells significantly outperforming the historical average well in the pool. Breaker's first multiple fracture operation on a previously-drilled horizontal well resulted in a more than tenfold increase in production rate, from 10 boe/d to a recent average rate of 110 boe/d, approximately one month after being put back on production. Breaker will also drill additional exploratory wells at Girouxville, where it has recently demonstrated a 100 percent success rate discovering high rate light oil pools.
Breaker's financial and operational flexibility gives it the ability to take advantage of current royalty rates via accelerated field activity to maximize the net present value of its high netback light oil drilling inventory.
A portion of the Flow-Through proceeds will also be invested in shooting a 3D seismic program early in 2008 on Breaker's 100 percent working interest high impact prospect in Monias, British Columbia. The prospect is a deep Leduc reef with an unrisked potential target size of 1 TCF.
Breaker Energy Ltd. is a junior oil and gas company focused on creating shareholder value by growing per share production and reserves through acquisitions and a focused exploration, development and exploitation plan.
Breaker now has 36,183,754 Class A shares and 900,000 Class B shares outstanding.
Breaker's shares trade on the Toronto Stock Exchange under the symbols WAV.A and WAV.B.
This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities of Breaker within the United States. The securities of Breaker have not been and will not be registered under the United States Securities Act of 1933, as amended (the "1933 Act"), or any state securities laws. Accordingly, the shares may not be offered or sold in the United States or to U.S. persons (as such terms are defined in Regulation S under the 1933 Act) unless registered under 1933 Act and applicable state securities laws or an exemption from such registration is available.
Forward-Looking Statements
--------------------------
This press release contains forward-looking statements concerning the Company's expectations of future production, cash flow, earnings and expansion of its oil and gas property interests and concerning the Company's exploration and development drilling, seismic operations, regulatory applications, payout estimates, capital expenditures, number and drilling locations, seismic acquisitions and facility upgrades. These statements are based on current expectations that involve a number of risks and uncertainties, which could cause actual results to differ from those anticipated. These risks include, but are not limited to: the risks associated with the oil and gas industry (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses, and health, safety and environmental risks), acquisitions, commodity price, price and exchange rate fluctuation and uncertainties resulting from competition from other producers and ability to access sufficient capital from internal and external sources. Additional information on these and other risk factors that could affect the Company's operations and/or financial results are included in the Company's reports on file with Canadian securities regulatory authorities.
The forward-looking statements or information contained in this news release are made as of the date hereof and the Company undertakes no obligation 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.
Oil and Gas Advisory
--------------------
This press release contains disclosure expressed as "Boe/d". Boe means barrel of oil equivalent and Boe/d means Boe per day. All oil and natural gas equivalency volumes have been derived using the ratio of 6,000 cubic feet of natural gas to 1 barrel of oil. Boe equivalency measures may be misleading, particularly if used in isolation. A conversion ratio of 6,000 cubic feet of natural gas to 1 barrel of oil is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the well head.
In this press release: (i) mmboe means million boe; (ii) boe/d means boe per day; (iii) bbls/d means barrels per day; (iv) mcf means thousand cubic feet; (v) mmcf means million cubic feet; (vi) mcf/d means thousand cubic feet per day; and (vii) mmcf/d means million cubic feet per day.
The TSX does not accept responsibility for the adequacy or accuracy of
this release.
%SEDAR: 00021180E