Gale Force Petroleum amends deal to purchase Buccaneer

MONTREAL, March 12 /CNW Telbec/ - Gale Force Petroleum Inc. (TSX Venture: GFP, the "Corporation") today announced that it has signed an agreement to amend the deal closed in trust with Buccaneer Energy Corporation, that was previously announced on February 10, 2010.

Under the terms of the new agreement with Buccaneer, the deal will be structured as an asset purchase instead of a shares purchase. The Corporation will purchase substantially all the assets of Buccaneer for a purchase price of (i) 6,223,032 common shares of the Corporation issued at a price of $0.25 per share for a total value of CA$1,555,755, (ii) 892,212 preferred shares convertible into up to 892,212 common shares of the Corporation with a total value of CA$223,053, and (iii) the assumption of CA$1,292,585 in total liabilities.

Buccaneer's assets are described in the news released by the Corporation on February 10, 2010, but include a workover rig and US$9,479,000 of proved reserves according to a report prepared by Michele K. Mudrone, P.Eng of MKM Engineering, in a report entitled "Appraisal of Certain Oil and Gas Properties Owned by Buccaneer Energy Corporation Located in Oklahoma, Tennessee and Texas" prepared as at October 1, 2009, using a discount rate of 10%, and using NYMEX prices until 2019, with prices held constant thereafter.

Buccaneer's assets also include US$301,560 (CA$317,431) of current assets, so the net working liabilities being assumed by the Corporation are US$766,195 (CA$806,521), which can be calculated as US$301,560 (CA$317,432) current assets of Buccaneer less US$161,328 (CA$169,819) in current liabilities, less US$808,796 (CA$851,364) in long-term bank debt, less US$97,631 (CA$102,769) in shareholder advances; this can otherwise be calculated as US$1,227,955 (CA$1,292,585) in gross liabilities, less US$160,200 (CA$168,632) in deferred income taxes, less US$301,560 (CA$317,432) in current assets. All accounting numbers used herein are from Buccaneer' financial statements as at December 31, 2009.

The transaction is now expected to be released from escrow shortly, following the filing on SEDAR of a full disclosure document by the Corporation and meeting other conditions as required by the TSX Venture Exchange's conditional approval of the transaction.


Gale Force Petroleum is a public corporation with a focus on the development and exploitation of oil and gas resources in mature basins, building shareholder value by making accretive acquisitions and developing its properties. It will own oil and natural gas properties in Texas, Oklahoma, Tennessee and Kentucky.

Forward looking statements:

Statements included herein, including those that express management's expectations or estimates of our future performance, constitute "forward-looking statements" within the meaning of applicable securities laws. Forward-looking statements - especially but not limited to any geological or reservoir information not supported by a NI 51-101 report - are based on assumptions and estimates that are subject to various risks and uncertainties including but not limited to geological risk, engineering risks, market risk and the risks disclosed under the heading "Business Risks" in the Corporation's periodic filings with Canadian securities regulators, including most recently in its Management Discussion and Analysis for the annual exercise ended June 30, 2009 available on SEDAR. Such information contained herein represents management's best judgment as of the date hereof based on information currently available. The Corporation does not assume the obligation to update any forward-looking statements.

"Neither 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 Gale Force Petroleum Inc.

For further information: For further information: Michael McLellan, Chairman and CEO, (514) 333-9292

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