/NOT FOR DISTRIBUTION TO THE UNITED STATES NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED STATES/
CALGARY, Dec. 20 /CNW/ - Silverwing Energy Inc., ("Silverwing" or the
"Company") (TSX:SVW) is pleased to provide the following operations update.
Completion of Tomahawk Drilling Program
Silverwing is pleased to announce that effective Dec. 17th, 2007, the
Company rig released the 22nd and final well of its intermediate depth
drilling program at Tomahawk. This effectively completes Silverwing's drilling
commitment of 22 Mississippian and Belly River wells that was to occur before
December 31, 2007. The Company has cased 21 out of the 22 wells drilled and
expects to commence in 2008 a program of further evaluation and testing of the
multi-zone oil and gas potential uncovered through drilling. Silverwing also
announces that with the completion of this drilling commitment, it has secured
the Escrow Funds of $11.1 million that was held back by the Farmor against
Silverwing completing the initial farm-in agreement. As of December 20, 2007,
$6.25 million remains the un-drawn balance in the Escrow Account.
The Tomahawk Farm-in provides Silverwing access to over 51,000 net acres
of undeveloped freehold land in the Tomahawk area of central Alberta. The area
is known for its under-explored multi-zone oil and gas potential along with
highly prospective formations including a Nisku interior patch reef oil trend,
a zone of primary interest to Silverwing.
The Tomahawk Farm-in Agreement requires Silverwing to drill 29 wells,
including up to 7 Nisku wells in the initial earning phase, with an option to
earn additional land with additional drilling commitments. An initial
commitment of drilling 22 intermediate depth wells to evaluate the
Mississippian (1,700m drilling depth) and Belly River (800m drilling depth)
potential was required to be completed no later than December 31, 2007.
Silverwing expects to commence drilling of its Nisku program during the first
quarter of 2008.
The Nisku is considered one of the hottest light oil plays in Alberta
having produced over 350 million barrels of oil and over 1.3 trillion cubic
feet of natural gas. Over the course of 2007 Silverwing has noted a
significant increase in 3-D seismic activity adjacent to its Tomahawk project
by firms targeting the Nisku formations. Drilling success rates in the Nisku
in recent years have significantly improved over historical experience due to
the use of 3D seismic. In addition, there has been a marked increase in the
prices paid for the acquisition of crown mineral rights and well licensing
activity by a number of known Nisku players. Four new Nisku well licenses have
recently been announced within the Silverwing Tomahawk project area by
competitors. Silverwing believes this recent activity validates its business
plan and in particular the value of its Tomahawk land holdings, once these are
The Nisku interior patch reef oil wells being targeted by Silverwing can
produce at rates of over 2,000 bbl oil/day and recoveries range in the
750-1,000 mbbls of oil. Silverwing has 5 high-graded Nisku oil prospects in
the Tomahawk project, all of which are defined by high-quality 3-D seismic.
In addition, Silverwing has a sixth high quality 3-dimensional
seismic-supported Nisku oil prospect at Easyford, Alberta, several kilometres
northwest of Drayton Valley, Alberta, and only about 1.5 kilometres from
existing Nisku oil production.
2008 Strategic and Operational Plan
Silverwing's strategic focus for 2008 can be summarized as follows:
With the completion of Silverwing's 22-well Mississippian and Belly River
drilling program in 2007, the Company will focus on exploiting the multi-zone
potential that has been uncovered at Tomahawk. Silverwing expects to commence
oil and gas production from Tomahawk in the third quarter of 2008. In
addition, the Company expects to focus its exploration drilling effort on its
high potential Nisku oil prospects on freehold lands at Tomahawk and on Crown
lands at Easyford, Alberta.
Finally, Silverwing expects to maintain its Prespatou, BC gas production
assets in 2008 and prepare for a new phase of development as gas commodity
prices strengthen. The Company also intends to evaluate its strategic options
on the Company's Bakken and Midale play at Torquay, Saskatchewan.
Silverwing Option Grant
The Company also announced today that, pursuant to its stock option plan,
it has granted options to acquire up to 8,190,000 common shares of Silverwing,
of which 6,340,000 options were granted to officers and directors. Each of the
options is exercisable for a five year term expiring on December 19, 2012, and
exercisable until that time at a price of $0.20 per common share, being the
market price of the common shares issued in its last private placement
financing closed in August of 2007. Any common shares issued upon exercise of
the options will be subject to a hold period expiring on April 20, 2008.
Silverwing Energy Inc. is a junior oil and gas exploration and production
company based in Calgary. The Company commenced drilling and production
operations in 2003 and has subsequently established two core operating
regions: the northeastern British Columbia Prespatou fairway and the Tomahawk
area of central Alberta. Silverwing has also established an exploratory
presence in the Torquay area of southwestern Saskatchewan, known for its
Midale and Bakken oil potential. All three areas of operation are primarily
immune to recent changes in the royalty regime in Alberta.
Investors are cautioned that the preceding statements of the Corporation
may include certain estimates, assumptions and other forward-looking
information. The actual future performance, developments and/or results
of the Corporation may differ materially from any or all of the forward-
looking statements, which include current expectations, estimates and
projections, in all or part attributable to general economic conditions
and other risks, uncertainties and circumstances partly or totally
outside the control of the Corporation, including natural gas/oil prices,
reserve estimates, drilling risks, future production of gas and oil,
rates of inflation, changes in future costs and expenses related to the
activities involving the exploration, development and production of gas
and oil hedging, financing availability and other risks related to
financial activities. The Corporation undertakes no obligation to update
forward-looking statements if circumstances or management's estimates or
opinions should change. The reader is cautioned not to place undue
reliance on forward-looking statements.
The TSX has not reviewed and does not accept responsibility for the
adequacy or accuracy of this news release.
For further information:
For further information: Silverwing Energy Inc., Oleh Wowkodaw,
President and Chief Executive Officer, (403) 538-5597, (403) 263-5549 (FAX),
Email: email@example.com or Terry O'Connor, Senior Vice President,
Business Development, (403) 538-5593, (403) 263-5549 (FAX), Email:
firstname.lastname@example.org or Martin Rude, Vice President, Finance and
Chief Financial Officer, (403) 538-5591, (403) 263-5549 (FAX), Email: