NewsRedStar Oil & Gas Inc. Increases Production to 1,800 BOED and Announces $2.1 Million Seismic Sale
CALGARY, ALBERTA--(CCNMatthews - March 28, 2006) -
Not for distribution to U.S. newswire services or for dissemination in
the United States of America.
CALGARY, ALBERTA--(CCNMatthews - March 28, 2006) - RedStar Oil & Gas
Inc. (TSX VENTURE:RED) (TSX VENTURE:RED.NV) ("RedStar" or the "Company")
is pleased to provide the following update.
Highlights:
- RedStar increases its production rates to 1,800BOE/D (10.8 mmcf/d);
- An additional 5 net wells are in the process of being completed and
tied in for production; and the
- Completion of a $2.24 ($2.1 net) million dollar seismic sale
($72,000/square mile).
RedStar has enjoyed record growth as it continues to add to its
production base. With the addition of 4.0 net successful natural gas
wells the Company is currently producing approximately 1,800 BOE/D.
Looking ahead, the Company has 5.0 additional net wells remaining to be
completed and tied-in which will further add to production from its
recent winter drilling program. RedStar is successfully executing its
business plan and looks to exit 2006 between 2,100 BOE/D and 2,500 BOE/D.
RedStar's first quarter 2006 operations will provide the majority of its
reserve additions. With several new pools identified the Company will
complete a reserves update and evaluation, which will be finalized once
the winter operations are complete.
RedStar is also pleased to announce today that it has completed the sale
of a portion of its Cutbank 3-D seismic data to another oil & gas
producer. Approximately 31.2 square miles of the data was sold for gross
proceeds of $2.24 million ($72,000 per square mile), approximately $1.85
million net cash, after transaction fees, will be available to be
redeployed within the Company. RedStar continues to have the proprietary
ownership of the 3-D seismic totaling approximately 400 square miles at
the Cutbank Ridge area. The seismic shoot was a joint venture initiative
with a large independent producer.
Cautionary Statements
Certain information set forth in this document, including management's
assessment of future plans and operations, contains forward-looking
statements. By their nature, forward-looking statements are subject to
numerous risks and uncertainties, some of which are beyond this party's
control, including the impact of general economic conditions, industry
conditions, volatility of commodity prices, currency fluctuations,
imprecision of reserve estimates, environmental risks, competition from
other industry participants, the lack of availability of qualified
personnel or management, stock market volatility and ability to access
sufficient capital from internal and external sources. Readers are
cautioned that the assumptions used in the preparation of such
information, although considered reasonable at the time of preparation,
may prove to be imprecise and, as such, undue reliance should not be
placed on forward-looking statements. Actual results, performance or
achievement could differ from those expressed in, or implied by, these
forward-looking statements, and accordingly, no assurance can be given
that any of the events anticipated by the forward-looking statements
will transpire or occur, or if any of them do so, what benefits will be
derived there from. RedStar disclaims any intention or obligation to
update or revise any forward-looking statements that are a result of new
information, future events, or otherwise.
Per barrel of oil equivalent amounts have been calculated using a
conversion of six thousand cubic feet of natural gas to one barrel of
oil equivalent (6:1). (Barrel of oil equivalents (boe) may be
misleading, particularly if used in isolation. A boe conversion ratio of
6mcf:1bbl is based on an energy equivalency conversion method primarily
applicable at the burner tip and does not represent a value equivalency
at the wellhead.)
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FOR FURTHER INFORMATION PLEASE CONTACT:
RedStar Oil & Gas Inc.
Chester J.R. Krala
President
(403) 262-3130
The TSX Venture Exchange Inc. has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release.