Kallisto announces closing of second tranche of private placement,
amalgamation with three subsidiary companies, and Pembina production update

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

CALGARY, Jan. 19 /CNW/ - Kallisto Energy Corp. (TSX Venture: KEC) (formerly Arrow Energy Ltd. - AOF) ("Kallisto" or the "Company") is pleased to announce that it closed the second tranche of the previously announced 2,500,000 common share non-brokered private placement by issuing 820,000 common shares at $0.42 per common share for gross proceeds of $344,400. The common shares issued in connection with this tranche are subject to a hold period under applicable securities laws of four months, expiring on May 20, 2010. Insider participation in the private placement totalled $52,500 or approximately 15.2%. Kallisto now has 15,832,447 common shares issued and outstanding.

On January 1, 2010, Kallisto completed an amalgamation with its three wholly-owned subsidiary companies: Castle Rock Petroleum Ltd., 1078287 Alberta Ltd. and 1125048 Alberta Ltd. The amalgamated entity retained the name Kallisto Energy Corp.

The Company's wells in the Pembina, Alberta area continue to perform in line with management's expectations. The three wells averaged approximately 600 boe per day in December, 2009 (90 boe per day net to Kallisto). During the first 15 days of January, 2010, production averaged approximately 425 boe per day (63 boe per day net to Kallisto). Management is pleased with the performance of these wells and anticipates that the fourth well of a planned twelve well program will commence by March 31, 2010.

Kallisto is a Calgary-based junior resource company engaged in the exploration, development and production of natural gas and oil primarily in Alberta.

This press release contains forward-looking statements which include, but are not limited to: operations plans and outlook, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it cannot give any assurance that such expectations will prove to be correct. Results of the Company may be affected by a variety of variables and risks associated with oil and gas exploration, production and transportation, such as loss of market, volatility of oil and gas prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, ability to access sufficient debt and equity capital from internal and external sources, ability to replace and expand oil and gas reserves, ability to generate sufficient cash flow from operations to meet its current and future obligations, and risks associated with existing and potential future lawsuits and regulatory actions made against the Company; as a consequence, actual results could differ materially from those anticipated or implied in the forward-looking statements. The Company's forward-looking statements are expressly qualified in their entirety by this cautionary statement and are made as of the date of this news release. Unless otherwise required by applicable securities laws, the Company does not intend nor does it undertake any obligation to update or review any forward-looking statements to reflect subsequent information, event, results or circumstances or otherwise.

THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

SOURCE Kallisto Energy Corp.

For further information: For further information: Robyn Lore, President and CEO, Telephone: (403) 237-9996, Facsimile: (403) 264-0416

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Kallisto Energy Corp.

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