Birch Lake Announces Closing of First Tranche of Private Placement Financing

CALGARY, Dec. 4, 2012 /CNW/ - Birch Lake Energy Inc. ("Birch Lake" or the "Corporation) (TSXV: BLK) announced today that it has closed the first tranche of its previously announced non-brokered private placement of common shares and flow-through shares for aggregate gross proceeds of $526,200, subject to TSX Venture Exchange final approval.  Birch Lake issued 600,000 common shares at $0.10 per common share and 3,885,000 flow-through shares at $0.12 per flow-through share.

The securities issued in connection with the offering will be subject to a four month hold period that expires on March 31, 2013.  The net proceeds from the offering will be used to finance the Corporation's continuing capital program and for general working capital purposes.  An additional tranche of the private placement is expected to occur on or about December 20, 2012.

Tony Boogmans, a director of the Corporation subscribed for 1,000,000 flow-through shares under the offering, as did certain other friends and business associates of the Board and management.  Birch Lake has determined that there are exemptions available from the various requirements of TSX Venture Policy 5.9 and Multilateral Instrument 61-101 for the issuance of these shares, (Formal Valuation - Issuer Not Listed on Specified Markets; Minority Approval - Fair Market Value Not More Than 25% of Market Capitalization).  No new insiders were created, nor has any change of control occurred, as a result of this private placement. No finder's fees were paid on the proceeds of this initial closing.

The Corporation is pleased to report that the first well of the initial two-well program on its Lochend-Springbank Cardium lands has been drilled and cased for completion to a measured depth of about 3525 meters, including a horizontal component of about 1250 meters. As anticipated, the horizontal component encountered oil bearing Cardium A sand throughout its length, with the expected excellent hydrocarbon indications from the mud log, drilling samples and electric logs. Completion and production testing of this first well is to begin within the next several days and is expected to be done before Christmas. The drilling rig is currently moving to the second well location and the Operator expects to similarly drill and case it before Christmas, with completion and production testing of it as soon as practically possible in the new year.

Further results will be released as they become available.

Forward Looking Statements:

This press release contains certain statements which constitute forward-looking statements or information ("forward-looking statements"), including statements regarding Birch Lake's business, the results of the two-well program and the financing which by their nature are forward-looking statements and which are subject to numerous risks and uncertainties, some of which are beyond Birch Lake's control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, operational risks in exploration and development, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and the ability to access sufficient capital from internal and external sources. Although Birch Lake believes that the expectations in our forward-looking statements are reasonable, our forward-looking statements have been based on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and assumptions are based upon currently available information. Such statements are subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in the forward looking information. As such, readers are cautioned not to place undue reliance on the forward looking information, as no assurance can be provided as to future results, levels of activity or achievements. The forward-looking statements contained in this document are made as of the date of this document and, except as required by applicable law, Birch Lake does not undertake any obligation to publicly update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement.

About Birch Lake Energy Inc.

Birch Lake is a junior oil and gas company engaged in the exploration for and the acquisition, development and production of oil and natural gas reserves. The Corporation's common shares are listed to trade on the TSX Venture Exchange under the symbol "BLK".

Neither the 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.

SOURCE: Birch Lake Capital Inc.

For further information:

William H. Petrie
President and Chief Executive Officer
(403) 457-1944

Profil de l'entreprise

Birch Lake Capital Inc.

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