Eagle Rock Exploration Announces Asset Sale



    CALGARY, Sept. 2 /CNW/ - Eagle Rock Exploration Ltd ("Eagle Rock" - TSXV:
ERX) announces that it has accepted a non-binding offer to purchase from an
arm's length party, certain petroleum and natural gas rights and associated
wells and facilities in the Red Coulee area of southern Alberta and the
Beverley area of south west Saskatchewan. The proposed transaction represents
310 bbls/d (July 2009 average production) of crude oil production and 18,000
acres (net) of leases (primarily Crown). The purchase price is approximately
$21 million, subject to normal industry closing adjustments.
    The transaction is subject to the completion of due diligence,
negotiating a formal purchase and sale agreement and obtaining the necessary
third party consents, governmental and regulatory approvals. The transaction
will be considered a "reviewable" transaction under the policies of the TSX
Venture Exchange ("Exchange"), requiring the approval of the shareholders of
Eagle Rock, such approval being acceptable to the Exchange if obtained by the
written consent of a majority of shareholders.
    The parties expect to complete the due diligence by September 8, 2009.
The purchase and sale is expected to close October 15, 2009 with an effective
date of September 1, 2009.
    National Bank Financial acted as financial advisor to Eagle Rock for this
transaction and is expected to continue to assist Eagle Rock in exploring
strategic relationships and restructuring alternatives.
    Should the transaction proceed as expected, Eagle Rock will retain
production of approximately 135 boe/d (80% crude oil and 20% natural gas) from
the Coutts, Spring Coulee and Enchant areas of southern Alberta. Eagle Rock
reported net debt of $20.3 million as at June 30, 2009 which was reduced by
$1.2 million as a result of an August 2009 property sale. Should the
transaction announced today close, Eagle Rock will have a positive working
capital surplus of approximately $1.5 million.

    About Eagle Rock Exploration Ltd.

    Eagle Rock is a publicly traded energy company involved in the
exploration and development of low to medium risk oil and gas properties in
Western Canada. Eagle Rock's common shares trade on the TSX Venture Exchange
under the symbol "ERX".

    Reader Advisory

    Certain information set forth in this news release contains
forward-looking statements. More particularly, this news release contains
statements concerning drilling plans and the purchase and sale of additional
interests in Eagle Rock's assets. By their nature, forward-looking statements
are subject to numerous risks and uncertainties, some of which are beyond
Eagle Rock's control, including the impact of general economic conditions,
industry conditions, volatility of commodity prices, currency fluctuations,
imprecision of reserve estimates, environmental risks, competition from other
industry participants, the lack of availability of qualified personnel or
management, stock market volatility and ability to access sufficient capital
from internal and external sources. Readers are cautioned that the assumptions
used in the preparation of such information, although considered reasonable at
the time of preparation, may prove to be imprecise and, as such, undue
reliance should not be placed on forward-looking statements. Eagle Rock's
actual results, performance or achievement could differ materially from those
expressed in, or implied by, these forward-looking statements and,
accordingly, no assurance can be given that any of the events anticipated by
the forward-looking statements will transpire or occur, or if any of them do
so what benefits Eagle Rock will derive therefrom. Eagle Rock disclaims any
intention or obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise, except as
required by securities laws.
    This news release shall not constitute an offer to sell or the
solicitation of any offer to buy securities in any jurisdiction.

    In this news release the calculation of barrels of oil equivalent (boe)
is calculated at a conversion rate of six thousand cubic feet (Mcf) of natural
gas for one barrel (Bbl) of oil based on an energy equivalency conversion
method. boes may be misleading particularly if used in isolation. A boe
conversion ratio of 6 Mcf: 1Bbl is based on an energy equivalency conversion
method primarily applicable to the burner tip and does not represent a value
equivalency at the wellhead.

    
    Neither TSX Venture Exchange nor its Regulation Services Provider (as
    that term is defined in the policies of the TSX Venture Exchange) accepts
    responsibility for the adequacy or accuracy of this release.
    

    %SEDAR: 00019108E




For further information:

For further information: please visit the Eagle Rock's website at:
www.eaglerockexploration.com or contact: Jim Silye, President and Chief
Executive Officer, Tel: (403) 269-4040, Fax: (403) 261-1978, E-mail:
jimsilye@eagler.ca

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EAGLE ROCK EXPLORATION LTD.

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