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
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