Falcon Oil & Gas Ltd. announces the filing of a preliminary short form prospectus for an offering of 11% unsecured convertible debentures and common shares


    TSXV Symbol:  FO

    DENVER, May 26 /CNW/ - Falcon Oil & Gas Ltd. (TSXV: FO) ("Falcon" or the
"Company") today announced that it has filed a preliminary short form
prospectus with the securities regulatory authorities in the provinces of
British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Nova Scotia and
New Brunswick. The offering is for units (the "Units") at a price of $1,000
per Unit (the "Offering"). Each Unit consists of one 11% convertible unsecured
debenture in the principal amount of $900 (each, a "Debenture") that matures
on the fourth anniversary of its issuance and a certain number of common
shares in the capital of the Company (the "Unit Shares"). The Debentures
contain certain automatic and optional conversion features, as well as certain
redemption features. The Offering will be conducted by Salman Partners Inc. as
    Final determination of the number of Units to be sold under the Offering
and the number of Unit Shares to be issued will occur prior to the filing of
the (final) short form prospectus in respect of the Offering.
    Falcon expects to use the net proceeds from the Offering for development
of its properties in Hungary and for general working capital, as determined
and approved by the board of directors of the Company. In addition, an amount
of the gross proceeds of the Offering equal to the first two interest payments
payable under the Debentures will be deposited in escrow at closing.
    Closing of the Offering is expected to occur on or about June 16, 2009
and is subject to certain conditions, including but not limited to, receipt of
all necessary securities regulatory approvals, including the approval of the
TSX Venture Exchange.

    This news release does not constitute an offer to sell or a solicitation
of an offer to buy any of the securities in the United States. The securities
have not been and will not be registered under the United States Securities
Act of 1933, as amended (the "U.S. Securities Act") or any state securities
laws and may not be offered or sold within the United States or to U.S.
Persons unless registered under the U.S. Securities Act and applicable state
securities laws or an exemption from such registration is available.

    About Falcon Oil & Gas Ltd.

    Falcon Oil & Gas Ltd. is a British Columbia corporation in the business
of oil and gas exploration and production. It has operations in Hungary
through its wholly owned subsidiary TXM Oil and Gas Exploration, LLC, in
Romania through its wholly owned subsidiary JVX Energy Corporation, in
Colorado through its wholly owned subsidiary Falcon Oil & Gas USA, Inc., and
in Australia through its wholly owned subsidiary Falcon Oil & Gas Australia
Pty Ltd. Further information about Falcon is available at

    In the interests of providing Company shareholders and potential
investors with information regarding the Company, including the Company's
assessment of its and its subsidiaries' future plans and operations, certain
statements included in this press release may constitute forward-looking
information or forward looking statements (collectively, "forward-looking
statements"). All statements contained herein that are not clearly historical
in nature are forward-looking, and the words "anticipate", "believe",
"expect", "estimate" and similar expressions are generally intended to
identify forward-looking statements. Similarly, forward-looking statements in
this press release include, but are not limited to anticipated developments of
the Company's drilling project in Hungary and the timing thereof, the
Company's drilling project in Australia and the timing thereof, capital
investment levels and the allocation thereof, pipeline capacity, government
royalty rates, reserve and resources estimates, the level of expenditures for
compliance with environmental regulations, site restoration costs including
abandonment and reclamation costs, exploration plans, acquisition and
disposition plans including farmout plans, net cash flows, geographic
expansion and plans for seismic surveys. In addition, please note that
statements relating to "reserves" or "resources" are deemed to be
forward-looking statements, as they involve the implied assessment, based on
certain estimates and assumptions, that the reserves and resources described
can be profitably produced in the future. Such statements represent the
Company's internal projections, estimates or beliefs concerning, among other
things, an outlook on the estimated amounts and timing of capital
expenditures, anticipated future debt levels and incentive fees or revenues or
other expectations, beliefs, plans, objectives, assumptions, intentions or
statements about future events or performance. These statements are only
predictions. Actual events or results may differ materially. Although the
Company believes that the expectations reflected in the forward-looking
statements are reasonable, it cannot guarantee future results, levels of
activity, performance or achievement since such expectations are inherently
subject to significant business, economic, competitive, political and social
uncertainties and contingencies. Many factors could cause the Company's actual
results to differ materially from those expressed or implied in any
forward-looking statements made by, or on behalf of, the Company and the
foregoing list of important factors is not exhaustive. These forward-looking
statements made as of the date hereof disclaim any intent or obligation to
update publicly any forward-looking statements, whether as a result of new
information, future events or results or otherwise. Company shareholders and
potential investors should carefully consider the information contained in the
Company's filings with Canadian securities administrators at www.sedar.com
before making investment decisions with regard to the Company.

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

For further information:

For further information: Contacts: Investor Relations, Falcon Oil & Gas
Ltd: North America: Brad Long, Toll Free (888) 541-3624, Direct (360)
332-9821, blong@falconoilandgas.com; Europe: Alexander Hubbard-Ford, Phone +
44 (0) 20 79351543, Mobile + 44 (0) 7984481541, investor@falconoilandgas.com;
Falcon Oil & Gas Ltd., Marc Bruner, CEO, 1875 Lawrence Street, Suite 1400,
Denver, Colorado, 80202, USA, Phone (303) 893-1800, Fax (303) 572-8927

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Falcon Oil & Gas Ltd.

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