Connacher reports significant increases in reserve volumes and pre-tax present values since year end 2007



    CALGARY, July 23 /CNW/ - Connacher Oil and Gas Limited (CLL - TSX)
announces a significant expansion of the company's reserves, resources and
related 10% pre-tax present value of future net revenue ("present value" or
"present worth" or "PV") since year end 2007. Unless otherwise stated,
reserves refer to reserves of either bitumen or conventional crude oil,
natural gas or natural gas liquids or barrels of oil equivalent ("boe") and
resources refers to bitumen resources. Certain amounts cited herein have been
rounded for presentation purposes.

    
    Highlights are as follows:

    Bitumen

    -   Total proved reserves ("1P") were up 108% to 110 million barrels;
        pre-tax 10% PV of future net revenue estimated at $899 million
        ($4.26 per basic Connacher common share ("common share" or "share")
        outstanding - 211 million shares outstanding at June 30, 2008).

    -   Total proved and probable reserves ("2P") were up 109% to 372 million
        barrels; pre-tax 10% PV of future net revenue estimated at $2 billion
        ($9.66 per common share).

    -   Total proved, probable and possible reserves ("3P") were up 83% to
        444 million barrels; pre-tax 10% PV of future net revenue estimated
        at $3 billion ($14.20 per common share), compared to $1.2 billion
        ($5.55 per share) at 31/12/07.

    -   2P plus best estimate contingent resources up 65% to 502 million
        barrels; pre-tax 10% PV of future net revenue of $2.3 billion
        ($10.90 per share).

    -   2P plus best estimate contingent and prospective resources up 40% to
        583 million barrels; pre-tax 10% PV of future net revenue of
        $2.5 billion ($11.95 per share).

    -   3P plus high estimate contingent and prospective resources up
        six percent to 843 million barrels; pre-tax 10% PV of future net
        revenue of $4.1 billion ($19.40 per share).

    Conventional

    -   1P reserves up seven percent to 7.3 million boe; pre-tax 10% PV of
        future net revenue $182 million ($0.86 per share).

    -   2P reserves up six percent to 9.99 million boe; pre-tax 10% PV of
        future net revenue of $229 million ($1.09 per share).
    

    The increase in bitumen reserves and resources and associated present
values is primarily at Great Divide and reflects the commencement of
production at Great Divide Pod One ("Pod One"), the anticipated near-term
approval of Algar or Pod Two, the company's second 10,000 bbl/d bitumen
project at Great Divide and the impact of Connacher's Q1 2008 core hole
drilling program on its main lease block in the region. Minor prospective
resources were assigned to Connacher's properties at Halfway Creek, Alberta,
reflecting early stage exploration in this region. The increase in
conventional reserves reflects successful drilling, also conducted during Q1
2008, at Marten Creek, Randall, Three Hills and Gilby, all in Alberta. All
present values are affected by the higher price deck adopted by GLJ Petroleum
Consultants ("GLJ") effective July 1, 2008 compared to that utilized at
December 31, 2007.
    Total corporate 2P reserves ("1P"-proved; "2P"-proved and probable;
"3P"-proved, probable, and possible) at June 30, 2008 increased 104 percent to
382 million barrels from 187 million barrels at December 31, 2007. The 10%
pre-tax present value for these 2P reserves increased 90 percent over December
31, 2007 estimates, from $1.2 billion to $2.3 billion ($10.75 per common
share). The 10 percent pre-tax present value of 2P reserves plus best estimate
contingent and prospective resources increased to $2.8 billion ($13.27 per
common share) compared to $1.9 billion ($9.05 per common share) at
December 31, 2007, when there were 210 million common shares outstanding.
    All reserve estimates are as at June 30, 2008 and do not include any of
the results of Connacher's drilling program subsequent to the effective date
of the GLJ 2008 Mid-Year Report. The full impact of this activity will be
captured in a year-end 2008 report, which will be prepared and reported upon
after relevant data are fully assessed by the company and GLJ, its independent
evaluators, after year-end 2008.
    Comparative reserve volumes and values are presented. There was a
material change in total estimated reserve and resource volumes compared to
those estimated at year-end 2007. For example, there was, respectively, a 108
percent, 109 percent and 83 percent increase in 1P, 2P and 3P bitumen reserves
and a 90 percent increase in the 10% present values assigned to Connacher's 2P
bitumen and conventional reserves at June 30, 2008, compared to the year-end
2007 estimates for this category.
    The reserve estimates provided herein were prepared by GLJ in a report
("GLJ 2008 Mid-Year Report") with an effective date of June 30, 2008. The GLJ
2008 Mid-Year Report was prepared using assumptions and methodology guidelines
outlined in the Canadian Oil and Gas Evaluation Handbook ("COGE Handbook") and
in accordance with National Instrument 51-101 ("NI 51-101"). Comparisons
provided herein with respect to Connacher's conventional and bitumen reserves
and resources are to estimates contained in a report prepared by GLJ with an
effective date of December 31, 2007 ("GLJ 2007 Report"). Future net revenue is
calculated after deduction of forecast royalties, operating expenses, capital
expenditures and abandonment costs but before corporate overhead or other
indirect costs, including interest and income taxes. The GLJ 2008 Mid-Year
Report was prepared utilizing the GLJ July 1, 2008 price forecast, effective
June 30, 2008. Readers are referred to the notes to the Summary Tables
included in this press release for details regarding the price forecast used
in the GLJ 2008 Mid-Year Report.
    The GLJ 2007 Report and the GLJ 2008 Mid-Year Report do not consider the
impact of the adoption of Alberta's new royalty regime in 2009. However, the
company did have GLJ prepare economic runs, assuming the royalty changes
become law. Under such circumstances, other things being equal, there would be
an approximate 14 percent to 18 percent reduction in the estimated 10 percent
pre-tax PV of the future net revenue from the company's bitumen reserves, if
the new regime was adopted as proposed. The new royalty regime does not appear
to have a material impact on the future net revenue and 10% pre-tax PV thereof
as it relates to the company's conventional reserves. It would be the
company's intention to commission an updated reserve report in the event the
proposed royalty regime is enacted into law and the results of this will be
communicated to shareholders and the investment community by way of press
release in such circumstances. See "Forward Looking Information" below.
    All references to barrel of oil equivalent ("boe") are calculated on the
basis of 6 mcf:1 bbl. Readers are cautioned that the conversion used in
calculating barrels of oil equivalent is based on an energy equivalency
conversion method primarily applicable at the burner tip and does not
represent a value equivalency at the wellhead. Furthermore, boes may be
misleading if used in isolation. Future net revenues disclosed herein do not
represent fair market value. Also, estimations of reserves and future net
revenue to be discussed in this press release constitute forward-looking
information. See "Forward Looking Information" below.

    Bitumen Reserves and Resources

    Connacher owns a 100% working interest in approximately 98,000 net acres
of oil sands leases at its Great Divide project in northeastern Alberta,
approximately 80 kilometres southwest of Fort McMurray and at Halfway Creek,
Alberta. Numerous oil accumulations in the McMurray formation have been
identified for development. GLJ estimates total bitumen initially in place
under Connacher's leases at Great Divide and Halfway Creek to be 1.56 billion
barrels of bitumen with up to 843 million barrels of 3P reserves and high
estimates contingent and prospective resources remaining to be exploited, net
of Pod One production prior to June 30, 2008.
    Pod One, which contains over 20 metres of net steam assisted gravity
drainage ("SAGD") pay, has been producing bitumen since late 2007. Production
since start up through June 30, 2008 has totaled 865,000 barrels of bitumen,
which amount has been deducted prior to the calculation of remaining reserves
and resources. Additional details regarding Connacher's development at Great
Divide can be accessed at www.connacheroil.com or www.sedar.com. Furthermore,
additional information regarding Connacher's resources, including the
company's interest in the resources and the risks and the level of uncertainty
allocated with the recovery of the resources can be found in the corporation's
annual information form dated March 26, 2008 which can be accessed at
www.sedar.com. In June 2007 the company applied to develop a similar
10,000 bbl/d facility at Pod Two or Algar and it is awaiting regulatory
approval. Reserves were assigned to Pod One, Pod Two or Algar, Pod 4 and 5 at
Algar (Phase II), while contingent and prospective resources were assigned to
all the aforementioned Pods and to Pods 3, 6 and 7 at Great Divide, with minor
best estimate and high estimate prospective resources assigned to Halfway
Creek, reflecting the early stage of exploration in this region.
    Since December 31, 2007, Connacher's 1P bitumen reserves increased
108 percent to 110 million barrels, after deduction of 856,000 barrels of
bitumen produced at Pod One since December 2007. Connacher's 2P bitumen
reserves also increased 109 percent to reach 372 million barrels, compared to
178 million barrels at year end 2007. 3P bitumen reserves were estimated at
444 million barrels at June 30, 2008 compared to 242 million barrels at
December 31, 2007, an increase of 83 percent.
    During 2008, GLJ was also able to continue its recognition of contingent
and prospective resources (as defined in the notes following the table below)
on the oil sands leases owned by Connacher. It should be noted that reserves,
contingent resources and prospective resources involve different risks
associated with achieving commerciality.
    Contingent resources were assigned in regions with lower core-hole
drilling density than the reserve regions and are outside current areas of
application for development. These resource estimates are not classified as
reserves at this time, pending further reservoir delineation, project
application, facility and reservoir design work. Contingent resources entail
additional commercial risk than reserves which have not been included in the
net present valuation. There is no certainty that it will be commercially
viable to produce any portion of the contingent resources.
    Prospective resources were also assigned in unexplored regions of
Connacher's acreage. Prospective resources entail additional commercial risk
than reserves and contingent resources which have not been included in the net
present valuation. There is no certainty that any portion of the prospective
resources will be discovered. If discovered, there is no certainty that it
will be commercially viable to produce any portion of the prospective
resources.
    Proved bitumen reserves (1P) and low estimate contingent resources were
estimated at 309 million barrels; 2P bitumen reserves and best estimate
contingent resources were estimated at 502 million barrels; 3P bitumen
reserves and high estimate contingent resources were estimated at 629 million
barrels.
    1P bitumen reserves and low estimate contingent and prospective resources
were estimated at 309 million barrels, the same as above, as no low estimate
(or high certainty) prospective resources were assigned. 2P bitumen reserves
and best estimate contingent and prospective resources were estimated at
583 million barrels and 3P bitumen reserves and high estimate contingent and
prospective resources were estimated at 843 million barrels.
    The GLJ 2008 Mid-Year Report estimated Connacher's 1P bitumen reserves
would generate $4.4 billion of future net revenue with a 10 percent pre-tax
present value of $899 million, after deduction of future capital requirements
of $985 million and abandonment costs of $23 million.
    2P bitumen reserves were forecast to generate $16.3 billion of future net
revenue, with a 10 percent pre-tax present value of $2.0 billion, after
provisions for future capital of $3.7 billion and abandonment costs of
$84 million.
    3P bitumen reserves were forecast to generate $17.9 billion of future net
revenue with a 10 percent pre-tax present value of $3 billion, after
provisions for future capital of $3.8 billion and abandonment costs of
$75 million.
    1P bitumen reserves plus low estimate contingent resources were forecast
to generate $13.4 billion, of future net revenue with a 10 percent pre-tax
present value of $1.5 billion, after provisions for future capital of
$3.9 billion and abandonment costs of $89 million.
    2P bitumen reserves and best estimate contingent resources were forecast
to generate $22.6 billion of future net revenue, with a 10 percent pre-tax
present value of $2.3 billion, after future provisions for future capital of
$6 billion and $145 million of abandonment costs.
    3P bitumen reserves plus high estimate contingent resources were forecast
to generate $25.9 billion of future net revenue, with a 10 percent pre-tax
present value of $3.6 billion, after provisions for future capital of
$6.4 billion and abandonment costs of $124 million.
    Economic runs for 1P bitumen reserves and low estimate contingent and
prospective resources are identical to 1P bitumen reserves plus low estimate
contingent resources, as no low estimate prospective resources were assigned.
    2P bitumen reserves and best estimate contingent and prospective
resources were forecast to generate $26.2 billion of future net revenue, with
a 10 percent pre-tax present value of $2.5 billion, after provisions for
future capital of $7.4 billion and abandonment costs of $172 million. Under
this scenario, future annual production is forecast by GLJ to peak at
approximately 42,000 barrels per day in 2017.
    3P bitumen reserves and high estimate contingent and prospective
resources were forecast to generate $36 billion of future net revenue, with a
10 percent pre-tax present value of $4.1 billion after provisions for future
capital of $9.6 billion and abandonment costs of $190 million. Under this
scenario, future annual production is forecast by GLJ to surpass 50,000
barrels per day by 2015 and 72,000 barrels per day in 2017.
    The resource volumes have not been classified as reserves at this time,
pending further delineation drilling, development planning, project design and
regulatory application. The resource values should be considered indicative in
nature, only, pending further design work to confirm timing and capital
estimates. Readers are cautioned that there is also a difference between
contingent and prospective resources with differing risks and that there is no
certainty that it will be commercially viable to produce any portion of the
resources.

    Conventional Reserves

    Connacher's conventional reserve base also expanded since year end 2007.
    On an oil equivalent basis, 1P reserves increased seven percent to
7.3 million boes after producing 550,000 boe in the first half of 2008. The
company's 2P equivalent reserves increased six percent to 20 million boe.
    The increases primarily reflect the successful drilling at Marten Creek,
Randall, Three Hills and Gilby, Alberta.
    The GLJ 2008 Mid-Year Report estimated that Connacher's conventional 1P
reserves would generate $284 million of future net revenue with a 10 percent
pre-tax present value of $182 million, after provision for future capital
requirements for Connacher's 1P reserves estimated at $14.2 million and
abandonment costs net of salvage value at $4.6 million.
    The company's 2P conventional reserves were forecast to generate
$393 million of future net revenue, with a 10 percent pre-tax present value of
$229 million, after provisions for future capital requirements of
$14.8 million and forecast abandonment costs of $5 million.
    Connacher's conventional production provides current cash flow, loan
value and a hedge against natural gas requirements at Great Divide.

    Total Company Combined Reserves (Conventional and Bitumen)

    On a combined basis, Connacher's reserves accordingly grew at very
significant rates. Total 1P equivalent reserves at June 30, 2008 were
estimated by GLJ to be 118 million boe, an increase of 96 percent over year
end 2007.
    Connacher's 2P equivalent reserves increased 104 percent to 381 million
boe at June 30, 2008 compared to 187 million boes at year end 2007.
    The company's 2P conventional and bitumen reserves at June 30, 2008 are
forecast to generate $16.7 billion of future net revenue, with a 10 percent
pre-tax present value of $2.3 billion, after provisions for future capital of
$3.7 billion and abandonment costs of $89 million. This represents a
90 percent increase in the 10 percent pre-tax present value compared to year
end 2007.
    On a per share basis, this estimated pre-tax present value of
approximately $2.3 billion for 2P reserves alone equates to approximately
$10.75 per Connacher common share outstanding, before provision for the value
of contingent and prospective resources as estimated in the GLJ Mid-Year 2008
Report, the value of the company's refinery and its investment in Petrolifera
Petroleum Limited and balance sheet adjustments. There are presently
approximately 211 million Connacher common shares outstanding.
    No reserve volumes or future net revenue or present value thereof where
assigned herein to Connacher's 24 percent equity interest in Petrolifera
Petroleum Limited's crude oil and natural gas reserves in Argentina.

    
    Summary Tables

    (Tables may not add due to rounding.)
    A. Volumes

    -------------------------------------------------------------------------
                        Connacher Oil and Gas Limited
                      Bitumen Reserves and Resources(9)
    -------------------------------------------------------------------------
                                                31/12/07  30/06/08
                                                      (mbbl)        % change

    Proved Reserves (1P)(1)                       53,016   110,202       108
    Proved and Probable Reserves (2P)(1)(2)      177,792   371,505       109
    Proved, Probable and Possible Reserves
     (3P)(1)(2)(3)                               242,009   443,802        83
    Low Estimate Contingent Resources(4)(6)       61,325   198,965       224
    Best Estimate Contingent Resources(4)(7)     125,531   130,206         4
    High Estimate Contingent Resources(4)(8)     209,855   185,681       -13
    1P + Low Estimate Contingent Resources
     (1)(4)(6)                                   114,340   309,167       170
    2P + Best Estimate Contingent Resources
     (1)(2)(4)(7)                                303,323   501,711        65
    3P + High Estimate Contingent Resources
     (1)(2)(3)(4)(8)                             451,895   629,483        39
    Low Estimate Prospective Resources(5)(6)           0         0         0
    Best Estimate Prospective Resources(5)(7)    113,398    81,278       -28
    High Estimate Prospective Resources(5)(8)    347,133   213,588       -38
    1P + Low Estimate Contingent and
     Prospective Resources(1)(4)(5)(6)(9)        114,340   309,167       170
    2P + Best Estimate Contingent and
     Prospective Resources(1)(2)(4)(5)(7)(9)     416,720   582,989        40
    3P + High Estimate Contingent and
     Prospective Resources(1)(2)(3)(4)(5)(8)(9)  799,028   843,072         6
    -------------------------------------------------------------------------



    -------------------------------------------------------------------------
                        Connacher Oil and Gas Limited
                     Conventional Canadian Reserves(10)
    -------------------------------------------------------------------------
              LIGHT/MEDIUM OIL/NGL
                    (mbbl)          NATURAL GAS (mmcf)     EQUIVALENT (mboe)

               31/12   30/06    %   31/12   30/06    %   31/12   30/06    %
                 /07     /08 change   /07     /08 change   /07     /08 change

    Proved
     Reserves
     (1P)(1)   2,356   2,430    3  26,916  29,431    9   6,842   7,335    7
    Probable
     Reserves
     (2)         694     770   11  11,535  11,283   -2   2,617   2,651    1
              ---------------     ----------------      ---------------
    Proved +
     Probable
     Reserves
     (2P)
     (1)(2)    3,050   3,200    5  38,451  40,714    6   9,459   9,986    6
    -------------------------------------------------------------------------



    -------------------------------------------------------------------------
                        Connacher Oil and Gas Limited
               Combined Conventional and Bitumen Reserves(10)
    -------------------------------------------------------------------------
                                                31/12/07  30/06/08
                                                      (mboe)        % change

    Proved Conventional Reserves(1)                6,842     7,335
    Proved Bitumen Reserves(1)                    53,016   110,202
                                                -------------------
    Total Proved Reserves (1P)(1)                 59,857   117,537        96

    Probable Conventional Reserves(2)              2,617     2,651
    Probable Bitumen Reserves(2)                 124,776   261,303
                                                -------------------
    Total Probable Reserves(2)                   127,393   263,954       107

    Proved + Probable Conventional Reserves
     (2P)(1)(2)                                    9,459     9,986
    Proved + Probable Bitumen Reserves(1)(2)     177,792   371,505
                                                -------------------
    Total 2P Reserves(1)(2)                      187,250   381,491       104
    -------------------------------------------------------------------------



    B. Present Value

    -------------------------------------------------------------------------
                        Connacher Oil and Gas Limited
                 10% Present Value of Future Net Revenue(9)
                 Bitumen Reserves and Resources - Before Tax
    -------------------------------------------------------------------------
                                                31/12/07  30/06/08
                                                       ($MM)        % change

    Proved Reserves (1P)(1)                          492       899        83
    Proved and Probable Reserves (2P)(1)(2)        1,051     2,039        94
    Proved, Probable and Possible Reserves
     (3P)(1)(2)(3)                                 1,165     2,996       157
    Low Estimate Contingent Resources(4)(6)          142       573       304
    Best Estimate Contingent Resources(4)(7)         348       260       -25
    High Estimate Contingent Resources(4)(8)         742       557       -25
    1P + Low Estimate Contingent Resources
     (1)(4)(6)                                       634     1,472       132
    2P + Best Estimate Contingent Resources
     (1)(2)(4)(7)                                  1,399     2,300        64
    3P + High Estimate Contingent Resources
     (1)(2)(3)(4)(8)                               1,906     3,553        86
    Low Estimate Prospective Resources(5)(6)           0         0         0
    Best Estimate Prospective Resources(5)(7)        379       222       -41
    High Estimate Prospective Resources(5)(8)        724       540       -25
    1P + Low Estimate Contingent and
     Prospective Resources(1)(4)(5)(6)(9)            634     1,472       132
    2P + Best Estimate Contingent and
     Prospective Resources(1)(2)(4)(5)(7)(9)       1,778     2,522        42
    3P + High Estimate Contingent and
     Prospective Resources(1)(2)(3)(4)(5)(8)(9)    2,631     4,093        56
    -------------------------------------------------------------------------



    -------------------------------------------------------------------------
                        Connacher Oil and Gas Limited
                   10% Present Value of Future Net Revenue
          Total Company (Conventional and Bitumen) - Before Tax(10)
    -------------------------------------------------------------------------

                                                       ($MM)
                                                31/12/07  30/06/08  % change

    Proved Conventional Reserves(1)                  112       182
    Proved Bitumen Reserves(1)                       492       899
                                                -------------------
    Total Proved Reserves (1P)(1)                    603     1,081        79

    Probable Conventional Reserves(2)                 32        48
    Probable Bitumen Reserves(2)                     559     1,140
                                                -------------------
    Total Probable Reserves(2)                       591     1,188       101

    Proved + Probable Conventional Reserves
     (2P)(1)(2)                                      143       230
    Proved + Probable Bitumen Reserves(1)(2)       1,051     2,039
                                                -------------------
    Total 2P Reserves(1)(2)                        1,194     2,269        90
    -------------------------------------------------------------------------

    Notes:

    1)  Proved reserves are those reserves that can be estimated with a high
        degree of certainty to be recoverable. It is 90% likely that the
        actual remaining quantities recovered will exceed the estimated
        proved reserves.
    2)  Probable reserves are those additional reserves that are less certain
        to be recovered than proved reserves. It is equally likely that the
        actual remaining quantities recovered will be greater or less than
        the sum of the estimated proved plus probable reserves.
    3)  Possible reserves are those additional reserves that are less certain
        to be recovered than probable reserves. There is only a 10%
        probability that the quantities actually recovered will equal or
        exceed the sum of proved plus probable plus possible reserves.
    4)  Contingent Resources are those quantities of petroleum estimated, as
        of a given date, to be potentially recoverable from known
        accumulations using established technology or technology under
        development, but which are not currently considered to be
        commercially recoverable due to one or more contingencies.
    5)  Prospective Resources are those quantities of petroleum estimated, as
        of a given date, to be potentially recoverable from undiscovered
        accumulations by application of future development projects.
    6)  Low Estimate is considered to be a conservative estimate of the
        quantity that will actually be recovered from the accumulation. If
        probabilistic methods are used, this term reflects P90 confidence
        level.
    7)  Best Estimate is considered to be the best estimate of the quantity
        that will actually be recovered from the accumulation. If
        probabilistic methods are used, this term is a measure of central
        tendency of the uncertainty distribution (P50).
    8)  High Estimate is considered to be an optimistic estimate of the
        quantity that will actually be recovered from the accumulation. If
        probabilistic methods are used, the term reflects a P10 confidence
        level.
    9)  Contingent resources and prospective resources are additive only for
        purposes of economic calculations, but are distinct categories with
        different risks.
    10) Does not include bitumen resources or undeveloped land value.
    11) Pricing assumptions in the GLJ Mid-Year 2008 Report were as follows:

        --------------------------------------------------
                        Bitumen               Natural Gas
                      (wellhead)         WTI        (AECO)
        --------------------------------------------------
                             $C          $US           $C
        2008 Q3/Q4        60.69       135.00        11.50
        2009              57.63       125.00        10.05
        2010              52.07       110.00         9.50
        2011              50.80       100.00         9.25
        2012              50.80       100.00         9.25
        2013              52.12       100.00         9.25
        2014              54.27       101.35         9.39
        2015              56.90       103.38         9.59
        2016              59.61       105.45         9.79
        2017              60.98       107.56        10.01
        Thereafter       +2%/yr       +2%/yr       +2%/yr
        --------------------------------------------------
    

    Forward Looking Information

    This press release contains forward looking information, including but
not limited to estimated reserves and future net revenues and future capital
expenditures and the anticipated impact of Alberta's proposed new royalty
regime on the company's estimated 10 percent pre-tax PV. With respect to the
forward looking information contained herein, the company has made assumptions
regarding, among other things, the future regulatory framework representing
royalties in the Province of Alberta. The forward looking information is based
on current expectations that involve a number of risks and uncertainties,
which could cause actual results to differ materially from those anticipated.
These risks include, but are not limited to 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 in relation to
production, costs and expenses and health, safety and environmental risks),
the risk of commodity price and foreign exchange rate fluctuations and risks
associated with obtaining, maintaining and the timing of receipt of regulatory
approvals, permits, and licenses. Additional risks and uncertainties are
described in the company's Annual Information Form which is filed on SEDAR at
www.sedar.com.
    The reserves and future pre-tax net revenue in this press release
represent estimates only. The reserves and future pre-tax net revenue from the
company's properties have been independently evaluated by GLJ with effective
dates of June 30, 2008 and December 31, 2007, respectively. This evaluation
includes a number of assumptions relating to factors such as initial
production rates, production decline rates, ultimate recovery of reserves,
timing and amount of capital expenditures, marketability of production, future
prices of crude oil and natural gas, operating costs, abandonment and salvage
values, royalties and other government levies that may be imposed during the
producing life of the reserves. These assumptions were based on price
forecasts prepared by GLJ as at the dates of the reports and many of these
assumptions are subject to change and are beyond the control of the company.
Actual production, sales and cash flows derived therefrom will vary from the
evaluation and such variations could be material. The present value of
estimated future net revenues referred to herein should not be construed as
the current market value of estimated crude oil and natural gas reserves
attributable to the company's properties.
    Due to the risks, uncertainties and assumptions inherent in forward
looking information, prospective investors in the company's securities should
not place undue reliance on forward looking information. Forward looking
information contained in this press release is made as of the date hereof and
are subject to change. The company assumes no obligation to revise or update
forward looking information to reflect new circumstances, except as required
by law.





For further information:

For further information: Richard A. Gusella, President and Chief
Executive Officer, OR Grant D. Ukrainetz, Vice President, Corporate
Development, Phone: (403) 538-6201, Fax: (403) 538-6225,
inquiries@connacheroil.com, Website: www.connacheroil.com


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