Nalcor Energy Becomes Operator of Drilling Exploration Program in Western Newfoundland August 7, 2009 – Marking a significant step for the future development of the province’s oil and gas resources, Ed Martin, President and CEO of Nalcor Energy and Jim Keating, Vice President of Nalcor Energy – Oil and Gas announced its operatorship in three exploration permits in the Parsons Pond area of the Great Northern Peninsula in Western Newfoundland. “Nalcor Energy’s exploration program on the province’s west coast will provide access to new, valuable information and further assess the petroleum potential in this area,” said Mr. Martin. “Improved prospectivity resulting from increased exploration activity may also entice other proponents to come into the area stimulating additional exploration activity and helping advance the west coast basin for future development.”
Nalcor Energy has acquired an average of 67 per cent gross working interest in three exploration permits on the west coast of the Northern Peninsula. “Nalcor Energy has acquired equity in three permits from Leprechaun Resources,” explained Mr. Keating. “This acquisition of working interest is valued at $559,000 for work commitments performed to date by Leprechaun Resources. In addition, Nalcor will assume its proportionate share of Leprechaun Resources work expenditure commitments to the Provincial Government. This refundable deposit of approximately $580,000 will be returned to Nalcor by the Provincial Government once the exploration drilling is completed.” In addition to Nalcor Energy, there are four other project partners with varying holdings in the three permits: Leprechaun Resources Ltd.; Deer Lake Oil and Gas Inc.; Investcan Energy Corporation; and Vulcan Minerals Inc. “Nalcor believes in the oil and gas potential of western Newfoundland and by partnering with companies active in the area we will bring together the resources and capability to mount a comprehensive exploration campaign to assess the oil and gas potential of this area,” added Martin. “As a company, we have an aggressive plan for growth, and this new acquisition fits with our long‐term plans. We look forward to working with our partners with a continued focus on safety, the environment and maximizing the value of the resources in this area of our province.” Nalcor will finalize its drilling plans in the coming weeks and expects to undertake up to a three‐well drilling program at an estimated cost of up to $20 million. The company will work with its joint venture partners to finalize the drilling plans and well locations for this exploration program. ‐30‐ About Nalcor Energy Nalcor Energy’s foundation is built on its base operating business: the generation and transmission of electrical power. Over the past three years, the company has expanded into the broader energy sector, including oil and gas, industrial fabrication, wind energy, and research and development. The company is also leading the development of the province’s energy resources, including the lower Churchill hydroelectric development. Nalcor Energy has five lines of business: Newfoundland and Labrador Hydro, Churchill Falls, Oil and Gas, Lower Churchill Project and Bull Arm Fabrication. Media Contact: Karen O’Neill Manager, Corporate Communications (Acting) t. 709.737.1427/ c. 709.690.2012 e. [email protected] BACKGROUNDER Parsons Pond Exploration Permits Exploration Permits The Western Newfoundland Parsons Pond prospects include three exploration permits covering 103,000 acres. Joint Venture Partners Equity in Exploration Permits after Transaction: Permit Nalcor Energy Others Leprechaun Resources ‐ 9.2857% Vulcan Minerals‐ 18.5714% Permit 101 62.1429% Investcan ‐ 8.0% Deer Lake Oil and Gas ‐ 2.0% Leprechaun ‐ 10.7393% Investcan ‐ 8.0% Permit 102 71.8707% Vulcan Minerals‐ 7.39% Deer Lake Oil and Gas ‐ 2.0% Leprechaun Resources ‐ 10.4% Investcan ‐ 8.0% Permit 103 69.601% Vulcan Minerals ‐ 10.0% Deer Lake Oil and Gas ‐ 2.0% Western Newfoundland Petroleum Rights
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