Fairmount announces substantial increase in reserves and filing of reserves data under NI 51-101



    /NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR FOR
    DISSEMINATION IN THE UNITED STATES OF AMERICA/

    CALGARY, June 18 /CNW/ - Fairmount Energy Inc. ("Fairmount" or the
"Company") (TSX-V - FMT) is pleased to announce a 116% increase in proved plus
probable oil and natural gas reserves and present a summary of its oil and gas
reserves reported under NI 51-101. Fairmount has filed its Statement of
Reserves Data, which includes reserves data and other oil and gas information
for the period ended March 31, 2007 and the reports as mandated by National
Instrument 51-101 with Canadian securities regulatory authorities. For a
complete copy of Fairmount's Statement of Reserves Data in accordance with NI
51-101 with the related reports, please visit www.sedar.com. Certain
information contained in this press release, including development plans,
drilling locations, and capital expenditures, constitute forward looking
statements which are subject to risks and uncertainties. See "Forward -
Looking Statements".

    Highlights

    
    -   Proved Reserves increased 111% from 614,000 boe at March 31, 2006 to
        1,293,000 boe at March 31, 2007.

    -   Proved plus Probable Reserves increased 116% from 951,000 boe at
        March 31, 2006 to 2,052,000 boe at March 31, 2007.

    -   Before tax present value of Proved Reserves discounted at 10%
        increased 104% from $10,729,000 at March 31, 2006 to $21,931,000 at
        March 31, 2007.

    -   Before tax present value of Proved plus Probable Reserves discounted
        at 10% increased 90% from $15,613,000 at March 31, 2006 to
        $29,658,000 at March 31, 2007.
    

    RESERVES
    The following information is extracted from the reserve report prepared
for the Company by its independent reservoir evaluators, GLJ Petroleum
Consultants as at March 31, 2007.

    
    Reserves Summary as at March 31, 2007

    -------------------------------------------------------------------------
              Light/   Light/
              Medium   Medium  Natural  Natural
               Oil      Oil     Gas      Gas     NGLs   NGLs    Total   Total
              Gross     Net    Gross     Net    Gross   Net     Gross    Net
             (mbbls)  (mbbls)  (mmcf)   (mmcf) (mbbls) (mbbls) (mboe)  (mboe)
    -------------------------------------------------------------------------
    Proved
     Producing   41       36   2,924    2,153     288     196    817     591
    -------------------------------------------------------------------------
    Proved
     Non
     Producing   11        9   1,850    1,350     147     103    466     337
    -------------------------------------------------------------------------
    Proved
     Un-
     developed    0        0      44       35       2       1      9       7
    -------------------------------------------------------------------------
    Total
     Proved      52       46   4,819    3,537     437     300  1,293     935
    -------------------------------------------------------------------------
    Total
     Probable    59       47   2,756    2,111     241     175    759     574
    -------------------------------------------------------------------------
    Total
     Proved &
     Probable   111       93   7,575    5,648     678     475  2,052   1,510
    -------------------------------------------------------------------------

    Gross reserves are the total of the Company's working interest. Net
reserves are gross reserves net of royalty interests owned by others.


    Net Present Value of Reserves (Before Tax) as at March 31, 2007(1)

    -------------------------------------------------------------------------
     ($ thousands)                Undiscounted      PV 5%    PV 8%    PV 10%
    -------------------------------------------------------------------------
    Proved Producing                    21,131     16,656   14,851    13,881
    -------------------------------------------------------------------------
    Proved Non Producing                12,439      9,615    8,437     7,794
    -------------------------------------------------------------------------
    Proved Undeveloped                     403        318      279       256
    -------------------------------------------------------------------------
    Total Proved                        33,973     26,588   23,567    21,931
    -------------------------------------------------------------------------
    Total Probable                      18,330     11,417    8,967     7,727
    -------------------------------------------------------------------------
    Total Proved & Probable             52,303     38,005   32,534    29,658
    -------------------------------------------------------------------------


    Net Present Value of Reserves After Tax as at March 31, 2007(1)

    -------------------------------------------------------------------------
     ($ thousands)                Undiscounted      PV 5%    PV 8%    PV 10%
    -------------------------------------------------------------------------
    Total Proved                        33,973     26,588   23,567    21,931
    -------------------------------------------------------------------------
    Total Probable                      13,650      8,813    7,063     6,162
    -------------------------------------------------------------------------
    Total Proved & Probable             47,623     35,401   30,630    28,093
    -------------------------------------------------------------------------
    


    Per barrel of oil equivalent amounts have been calculated using a
conversion rate of six thousand cubic feet of natural gas to one barrel of oil
(6:1). Barrel of oil equivalents ("boe") may be misleading, particularly if
used in isolation. A boe conversion ratio of 6 mcf:1 bbl is based on an energy
equivalency conversion method primarily applicable at the burner tip and does
not represent a value equivalency at the wellhead.

    
    (1) Estimated values disclosed do not represent fair market value. The
        reserve values are based on the table of prices below. Prices at each
        property were adjusted for quality, heating content and
        transportation. Oil prices are the equivalent price of sweet light
        crude landed in Edmonton to that of West Texas Intermediate crude
        (WTI) in Cushing, Oklahoma after adjustments for transportation and
        the prevailing Canadian dollar exchange rate. A Canadian dollar
        exchange rate of $0.85 US to $1.00 Canadian was used. Gas prices are
        based on the type of contract applicable. The NGL price was
        established for each property based on the gas stream recovered at
        the plant and wellhead for that property.

    Price Forecast
    -------------------------------------------------------------------------
                   Oil    Gas (AECO-C)    Pentanes +    Propane      Butane
               ($Cdn/bbl) ($Cdn/mmbtu)   ($Cdn/bbl)   ($Cdn/bbl)   ($Cdn/bbl)
    -------------------------------------------------------------------------
    2007           70.25         7.30        71.75        45.00        56.25
    -------------------------------------------------------------------------
    2008           68.00         7.65        69.25        43.50        50.25
    -------------------------------------------------------------------------
    2009           65.75         7.75        67.00        42.00        48.75
    -------------------------------------------------------------------------
    2010           64.50         7.80        65.75        41.25        47.75
    -------------------------------------------------------------------------
    2011           64.50         7.85        65.75        41.25        47.75
    -------------------------------------------------------------------------
    2012           65.00         8.15        66.25        41.50        48.00
    -------------------------------------------------------------------------
    2013           66.25         8.30        67.50        42.50        49.00
    -------------------------------------------------------------------------
    2014           67.75         8.50        69.00        43.25        50.25
    -------------------------------------------------------------------------
    2015           69.00         8.70        70.50        44.25        51.00
    -------------------------------------------------------------------------
    2016           70.50         8.90        72.00        45.00        52.25
    -------------------------------------------------------------------------
    2017           71.75         9.10        73.25        46.00        53.00
    -------------------------------------------------------------------------
    2018+       +2.0%/yr     +2.0%/yr           Escalate at 2.0% per year
    -------------------------------------------------------------------------
    

    Forward-Looking Statements

    This press release contains forward-looking statements, including but not
limited to estimated reserves and future net revenues. Statements relating to
reserves and related future net revenue are forward-looking statements as they
involve the implied assessment, based on certain estimates and assumptions,
that the reserves described can be profitably produced in the future.
Additionally, estimates of future net value involve assumptions relating to
production rates, commodity prices and exchange rates, operating costs,
capital expenditures and well abandonment costs. These statements relate to
future events or the Company's future performance. All statements other than
statements of historical fact are forward-looking statements. In some cases,
forward-looking statements can be identified by terminology such as "may",
"will", "should", "expect", "plan", "anticipate", "believe", "estimate",
"predict", "potential", "continue", or the negative of these terms or other
comparable terminology. Forward looking statements relating to reserves and
future net revenue are estimates only. Actual reserves and future net revenues
will differ from those estimated by GLJ Petroleum Consultants and such
differences may be material. By its nature, forward-looking information
involves numerous assumptions, known and unknown risks and uncertainties, both
general and specific, that contribute to the possibility that the predictions,
forecasts, projections and other forward-looking statements will not occur.
Forward-looking statements are based on assumptions, including, among other
things, the Company's ability to benefit from the combination of growth
opportunities and the ability to grow through the capital markets; the
Company's acquisition strategy, the criteria to be considered in connection
therewith and the benefits to be derived therefrom; sustainability and growth
of production and reserves through prudent management and acquisitions; the
emergence of accretive growth opportunities; the impact of Canadian
governmental regulation on the Company; the strategy of the Company regarding
commodity price risk management, changes in oil and natural gas prices and the
impact of such changes on financial performance; the level of capital
expenditures devoted to development activity rather than exploration; the use
of development activity and/or acquisitions to replace and add to reserves;
the quantity of oil and natural gas reserves and oil and natural gas
production levels; and currency, exchange and interest rates.
    Although the Company believes that the expectations reflected in the
forward-looking statements are reasonable, there can be no assurance that such
expectations will prove to be correct. The Company can not guarantee future
results, levels of activity, performance, or achievements. Moreover, neither
the Company nor any other person assumes responsibility for the accuracy and
completeness of the forward-looking statements. Some of the risks and other
factors, some of which are beyond the Company's control, which could cause
results to differ materially from those expressed in the forward-looking
statements contained in this press release include, but are not limited to,
general economic conditions in Canada, the United States and globally;
industry conditions, including fluctuations in the price of crude oil, natural
gas and natural gas liquids and services used by the Company; uncertainties
associated with estimating reserves; royalties payable in respect of oil and
gas production; governmental regulation of the oil and gas industry, including
income tax and environmental regulation; fluctuation in foreign exchange or
interest rates; stock market volatility and market valuations; the impact of
environmental events; the need to obtain required approvals from regulatory
authorities; unanticipated operating events which can reduce production or
cause production to be shut-in or delayed; failure to obtain industry partner
and other third party consents and approvals, when required; and third party
performance of obligations under contractual arrangements. Subject to the
company's obligations under applicable securities laws, the Company is not
under any duty to update any of the forward-looking statements after the date
of this press release to conform such statements to actual results or to
changes in the Company's expectations.

    The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this release.





For further information:

For further information: Joseph S. Durante, President and CEO,
JDurante@Fairmountenergy.com or Ryan A. Michaluk, VP Finance and CFO,
RMichaluk@Fairmountenergy.com; Fairmount Energy Inc., 2200, 520 - 5th Avenue
SW, Calgary, Alberta, T2P 3R7, Phone: (403) 355-0440, Fax: (403) 355-0465;
Visit us at our website www.fairmountenergy.com

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FAIRMOUNT ENERGY INC.

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