Alberta Clipper Energy Inc. (ACN - TSX) Announces Second Quarter Results



    /NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN
    THE UNITED STATES./

    CALGARY, Aug. 12 /CNW/ - Alberta Clipper Energy Inc. ("Alberta Clipper"
or the "Company") is pleased to announce that it has filed its unaudited
financial statements and related management's discussion and analysis for the
three and six months ended June 30, 2008 on www.albertaclipperenergy.com and
www.sedar.com. Certain selected financial and operational information for the
three and six months ended June 30, 2008 and June 30, 2007 comparatives are
set out below and should be read in conjunction with Alberta Clipper's
unaudited financial statements and related MD&A.

    
                             CORPORATE HIGHLIGHTS

                                      Three      Three        Six        Six
                                     months     months     months     months
                                      ended      ended      ended      ended
                                    June 30,   June 30,   June 30,   June 30,
                                       2008       2007       2008       2007
    Financial ($000's, except per
     share amounts)
    Petroleum and natural gas
     sales                           25,146     10,584     42,635     18,791
    Funds generated by
     operations(1)                   13,754      5,218     22,739      9,217
      Per share basic                  0.24       0.10       0.40       0.20
      Per share diluted                0.24       0.10       0.40       0.20
    Net earnings/loss                 3,474     (1,000)     3,141     (1,684)
      Per share basic                  0.06      (0.02)      0.06      (0.04)
      Per share diluted                0.06      (0.02)      0.06      (0.04)
    Capital expenditures              8,259     10,524     19,985     30,983
    Acquisitions, net of
     dispositions                     1,268     63,520      7,173     72,124
    Net debt and working capital
     surplus (deficiency)           (45,176)   (39,321)   (45,176)   (39,321)

    Operating

    Production
      Crude oil and natural gas
       liquids (Bbls per day)         1,323        763      1,283        725
      Natural gas (Mcf per day)      11,728      9,024     10,644      7,683
      Barrels of oil equivalent
       (Boe per day, 6:1)             3,277      2,267      3,057      2,006
    Average realized price
      Crude oil and natural gas
       liquids ($ per Bbl)           111.98      65.00     100.52      63.75
      Natural gas ($ per Mcf)         10.93       7.39       9.89       7.50
      Barrels of oil equivalent
       ($ per Boe, 6:1)               84.31      51.30      76.63      51.75
    Netback per Boe (6:1) ($)
      Petroleum and natural gas
       sales                          84.31      51.30      76.63      51.75
      Hedging                         (5.43)         -      (3.35)         -
      Royalties                      (16.60)    (11.12)    (16.01)    (11.24)
      Operating expenses             (10.55)     (8.80)    (10.38)     (9.81)
      Transportation expenses         (0.80)     (0.80)     (0.74)     (0.87)
    Operating Netback                 50.93      30.58      46.15      29.83

    Undeveloped land holdings
     (net acres)                    171,732    193,652    171,732    193,652

    Common Shares (000's)
    Shares outstanding, end of
     period                          56,473     56,469     56,473     56,469
    Weighted average shares,
     diluted                         57,209     51,534     57,162     47,164

    (1) Management uses funds generated by operations to analyze operating
        performance and Leverage. Funds generated by operations as presented
        do not have any standardized meaning prescribed by Canadian GAAP and
        therefore it may not be comparable with the calculation of similar
        measures for other entities.
    

    Alberta Clipper Energy Inc. ("Alberta Clipper" or the "Company")
experienced its most successful quarter in Company history achieving record
results in all major financial and operating measures. Production increased
from 2,267 boe/d in the second quarter of 2007 to 3,277 boe/d in the second
quarter of 2008, an increase of 45% year over year and an increase of 16% over
the first quarter of 2008. Cash flow per share increased 140% to $0.24 per
share in the second quarter of 2008 over the second quarter of 2007 and
increased 50% over the first quarter of 2008.
    Alberta Clipper drilled 2 (1.1 net) wells in the second quarter of 2008
resulting in 1 oil well and 1 gas well. Drilling activity for the three months
ended June 30, 2008 is summarized in the following table:

    
          ---------------------------------------------------------
                      Gross (Net) Well Count - ALL AREAS
          ---------------------------------------------------------
                      Oil       Gas     Service     D&A      Total
          ---------------------------------------------------------
          2008 Q2   1 (0.6)   1 (0.5)      -         -      2 (1.1)
          ---------------------------------------------------------



     -------------------------------------------------------------------
                  Gross (Net) Well Count by Area - ALL AREAS
     -------------------------------------------------------------------
                          WAB-      WAB-
                 CAB     Other     Sylvan    TRUTCH     NEBC      Total
     -------------------------------------------------------------------
     2008 Q2      -         -      2 (1.1)      -         -      2 (1.1)
     -------------------------------------------------------------------

    Highlights of achievements for the second quarter of 2008 for Alberta
Clipper include the following:

    -   Increased cash flow by 164% and cash flow per share by 140% over
        Q2 2007
    -   Increased production by 45% and production per share by 30% over
        Q2 2007
    -   Increased earnings to $0.06/share compared to a loss of $0.02/share
        in Q2 2007
    -   Completed a material land expansion initiative in the Deep Basin on
        an emerging play proven-up by 3 months of sustained, high rate gas
        production from the Company's New Pool Discovery at Kakwa, Alberta
    -   Announced the acquisition of Escavar Energy Inc. ("Escavar"), a
        private company with 400 boed of high working interest production and
        over 50,000 net acres of undeveloped land possessing substantial
        scalable play potential which subsequently closed July 29, 2008.
    

    Highlights for the second quarter surround activities associated with
Alberta Clipper's previously announced significant New Pool Discovery made at
Kakwa, Alberta during the first quarter of 2008. Through the second quarter of
2008, the Company has confirmed sustainable high-rate production from the
first two wells drilled into the pool, and completed detailed 3D seismic
mapping and land positioning initiatives on the play. Delineation drilling and
3D seismic mapping now indicate a productive channel trend where the gross
volumetric potential could exceed 40 BCF of original-gas-in-place on Company
lands. Gross production from the property for the second quarter of 2008 has
averaged in excess of 2 mmcf/d per well. Twelve development locations have
been identified on Alberta Clipper acreage assuming 2 wells per section
spacing. Pending additional production history, down-spacing to 4 wells per
section or the use of horizontal wells employing multi-stage hydraulic
fracturing technology may be justified to optimize recovery efficiency.
Alberta Clipper gained access to the Kakwa area originally by way of a
strategic asset swap and has subsequently increased its presence along the
high-graded play fairway through acreage based poolings and farm-ins.
Operations timing is dictated by variable seasonal access throughout the
project area. Upon completion of a 3D seismic option, Alberta Clipper will
hold an average working interest of approximately 40% in 11,360 gross acres of
land at Kakwa.
    During the second quarter, Alberta Clipper's drilling operations were
restricted due to overly wet conditions in the field and seasonal road bans.
Evaluation activities associated with strategic acquisitions, including the
acquisition of Escavar, dominated the company's focus and allocation of "new
project" capital during the quarter. As a result of the corporate acquisition,
the Company's exposure to scalable gas plays has expanded considerably and the
second half program will include significant activity developing these
projects.
    In Western Alberta ("WAB"), the Company drilled and completed a
horizontal well in the Sylvan area where it is currently awaiting production
results associated with a multi-stage fracture stimulation of a traditionally
low-recovery, large resource-in-place reservoir. Pending favorable production
performance, the company intends to apply the same exploitation scheme to
other Cretaceous reservoirs in the area where it holds Cretaceous mineral
interests.
    Further drilling activity during the quarter included a new gas pool
discovery in the Mississippian at Sylvan Lake. The well has been production
tested and is expected to be brought on production later in the second quarter
at an initial rate of approximately 100 boe/d net to Alberta Clipper.
    The second quarter of 2008 also marked the completion the Company's 10km
pipeline project at Trutch in Northeast British Columbia ("NEBC") that has
established a new development corridor for the Trutch property. The
construction of this new pipeline will allow for aggressive development of the
lands to the west of current production.
    Expansion activities within the Company's core areas continued during the
quarter with 1,380 gross (690 net) acres of land being acquired in the
company's NEBC core area plus an additional 3,520 gross (2,680 net) acres
acquired in the WAB area. The Company's total opportunity inventory count now
stands at over 200.

    OUTLOOK

    The program for the second half of 2008 will see Alberta Clipper continue
to expand its presence in scalable development projects as well as accelerate
development of assets associated with the Company's recently announced
acquisition of Escavar. Specific to the acquisition, early in the third
quarter, a vertical well was drilled and cased at Economy Creek which
encountered 216 feet of log pay in the Montney Formation and was cased for
multi-zone potential. The Montney zone is expected to be completed during the
month of August. With a successful test, Alberta Clipper has in excess of
11,200 acres of company and farm-in option lands that are prospective for
Montney horizontal development within the vicinity of the well. A minimum of 4
additional wells are scheduled to be drilled on Escavar's lands prior to the
end of the year.
    The majority of post break up drilling activity was delayed by extremely
wet conditions that persisted through the end of the second quarter and into
the third quarter in both Sylvan Lake and NEBC. The wet conditions and
resulting restrictions on road use also affected routine maintenance
operations on existing producing wells resulting in lower than normal on-time
efficiencies during the month of July.
    In NEBC, subsequent to quarter end, Alberta Clipper further increased its
working interest in its Trutch property to approximately 95%. Operations
currently underway at Trutch involve testing the Montney formation in an
existing well bore in an area where there is currently no Montney production.
If productive capability is proven up by the test, significant potential
exists to expand the company's reserve base on the 16,700 net acres of
undeveloped land held at Trutch. Because of the potential to exploit the
Montney from vertical Halfway development wells, the incremental cost of
producing the Montney if successful will be substantially lower than in a
stand alone situation.
    Also in NEBC, the Company is currently drilling a multi-zone well at Beg
where combined unrisked volumetric potential exceeds 1 million barrels of oil
equivalent from 4 separate reservoirs. Alberta Clipper holds over 50,000 net
acres of undeveloped land in NEBC with production proven from 8 stratigraphic
intervals, 3 of which have potential to benefit significantly from the
application of new recovery-optimization technologies not yet applied to the
properties.
    At Sylvan Lake, Alberta Clipper plans to drill up to 5 wells during the
remainder of 2008. Included in this program are 2 Mississippian exploration
wells, 1 Mississippian horizontal development well, 1 Leduc development well,
and 1 Ostracod development well. The activities at Sylvan Lake are focusing on
lower risk repeatable opportunities that have the potential to be applied
throughout the Company's extensive land base.
    In the Bigstone/Fir area of WAB the Company plans to drill 3
multi-zone-potential wells within the third quarter, each which has a
development component targeting the Gething formation and exploratory
components targeting the Cadomin and Montney formations. Drilling operations
are scheduled to commence mid-August. Alberta Clipper holds a 100% working
interest in 10,560 net acres of land at Bigstone and has over 520 sq kms of 3D
seismic data over its working-interest lands and surrounding areas.
    At Kakwa, the operator of the property plans to initiate a 5 well
drilling program in October that will carry on through the first quarter of
2009. Two to three wells will be drilled during the fourth quarter of 2008
pending seasonal accessibility with the remainder being drilled in early 2009.
Included in the program will be at least 1 horizontal well where multi-stage
fracturing technology will be employed. The operator is targeting having all 5
wells tied-in and on production by April 1, 2009.

    
    A summary of 2008 activity is provided in the following table:

    ------------------------------------------------------------------------
                     Gross (Net) Well Count - ALL AREAS
    ------------------------------------------------------------------------
                     Oil       Gas       D&A     EXPLN     DVMNT     Total
    ------------------------------------------------------------------------
    2008 YTD       3 (1.7)    7 (3.1)     -     4 (2.2)   6 (2.6)   10 (4.8)
    ------------------------------------------------------------------------
    2008 Remaining 4 (1.8)  16 (11.1)     -     7 (4.9)  13 (8.0)  20 (12.9)
    ------------------------------------------------------------------------
    Q2-2008 Total  1 (0.6)    1 (0.5)     -        -      2 (1.1)    2 (1.1)
    ------------------------------------------------------------------------



    ------------------------------------------------------------------------
                 Gross (Net) Well Count by Area - ALL AREAS
    ------------------------------------------------------------------------
                               WAB-      WAB-     NEBC-   NEBC-
                     CAB      Other     Sylvan   TRUTCH   Other      Total
    ------------------------------------------------------------------------
    2008 YTD       1 (0.5)    4 (1.6)   5 (2.7)     -        -      10 (4.8)
    ------------------------------------------------------------------------
    2008 Remaining 1 (0.5)   11 (6.7)   5 (3.3)  2 (1.4)  1 (1.0)  20 (12.9)
    ------------------------------------------------------------------------
    Q2-2008 Total     -          -      2 (1.1)     -        -       2 (1.1)
    ------------------------------------------------------------------------
    

    The second half of 2008 will be a very active period for Alberta Clipper
in which the Company will continue to develop its existing inventory of
projects and will test a number of new potentially scalable projects any one
of which has the potential to dramatically increase the reserve base of the
Company. The addition of the Escavar assets, provide further diversity to the
Company's asset base while maintaining the commitment to our three part
strategy of scalable development, high impact exploration, and enhanced
recovery. By the end of 2008, Alberta Clipper will have completed the
transformation from a small concentrated explorer to a larger entity with a
diversified portfolio of opportunities with the potential to materially
increase the reserve base of the Company.

    For further information regarding Alberta Clipper Energy Inc., the reader
is invited to visit the Company's website at www.albertaclipperenergy.com.

    Alberta Clipper Energy Inc. is a publicly traded Canadian energy company
involved in the exploration, development and production of natural gas and
crude oil in western Canada.

    As referred to above, to view Alberta Clipper's unaudited financial
statements and related MD&A for the three and six months ended June 30, 2008
please visit www.albertaclipperenergy.com or www.sedar.com. To the extent
investors do not have access to the internet, copies of the audited financials
and related MD&A can be obtained on request without charge by contacting
Investor Relations at (403) 440-3474 or at 1800, 500 - 4th Avenue SW, Calgary,
Alberta, T2P 2V6.

    FORWARD-LOOKING STATEMENTS
    This press release may contain forward-looking statements including
expectations of future production. More particularly, this press release
contains statements concerning Alberta Clipper's future production estimates,
expansion of oil and gas property interests, exploration and development
drilling, capital expenditures, number and drilling locations to be drilled in
2008 and 2009, seismic acquisitions and facilities 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),
commodity price, price and exchange rate fluctuation and uncertainties
resulting from potential delays or changes in plans with respect to
exploration or development projects or capital expenditures. Additional
information on these and other factors that could affect Alberta Clipper's
operations or financial results are included in Alberta Clipper Energy'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 Alberta Clipper 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". All oil and
natural gas equivalency volumes have been derived using the ratio of six
thousand cubic feet of natural gas to one barrel of oil. Equivalency measures
may be misleading, particularly if used in isolation. A conversion ratio of
six thousand cubic feet of natural gas to one 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.

    The Toronto Stock Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release. Not for
distribution to U.S. newswire services or for dissemination in the United
States. Any failure to comply with this restriction may constitute a violation
of U.S. securities law.

    %SEDAR: 00022458E E




For further information:

For further information: Kel Johnston, President & C.E.O., Alberta
Clipper Energy Inc., Telephone: (403) 440-3474, Facsimile: (403) 440-3475,
Website: www.albertaclipperenergy.com

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ALBERTA CLIPPER ENERGY INC.

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