FAIRBORNE ENERGY MAKES STRATEGIC LAND AND FACILITIES ACQUISITION
ON GROWING WILRICH GAS PLAY
Fairborne Energy Ltd. ("Fairborne" or the "Company") (TSX:FEL
) is pleased to announce that it has
entered into an agreement to purchase a significant land position with producing assets and facilities (the
“Assets”) in the Company’s core Marlboro/Pine Creek area. The acquisition will have an effective date of
July 1, 2010 and is expected to close on or about September 9, 2010 for a cash purchase price, at closing, of
approximately $71.5 million, subject to closing adjustments. The completion of the transaction is subject to
customary regulatory approvals and other conditions. The acquisition will be funded through Fairborne’s
existing credit facility.
Transaction Highlights:
The Assets to be acquired by Fairborne doubles the Company’s position in a significant new gas play and
exploration trend in the Company’s core Marlboro/Pine Creek area of West Central Alberta.
The acquisition has the following assets and attributes:
•
167 gross sections (91.4 net sections) of land, which includes 71.8 net sections of undeveloped
Wilrich rights;
•
Significant development opportunities on the Assets with an identified inventory of more than 200
potential Wilrich horizontal locations on the acquired lands;
•
Over 30 potential gross Notikewin/Falher horizontal locations;
•
Significant number of vertical locations with multi zone potential;
•
More than 100 workover locations in various reservoirs identified in existing well bores;
•
Strategic infrastructure including over 150 km of operated pipelines and a 55.1% working interest in
a 14 MMcf/d (licensed to 42 MMcf/d) gas plant;
•
Reserves estimated by GLJ Petroleum Consultants Ltd., effective as of June 30, 2010, of 2.7 MMboe
total proved and 5.1 MMboe total proved plus probable; and
•
Current production of approximately 980 boe/d of mature, shallow decline production (83% gas).
