ALBERTA STAR DEVELOPMENT CORP. CLOSES OIL AND NATURAL GAS ASSET PURCHASE WITH WESTERN PLAINS PETROLEUM LTD.
CALGARY, ALBERTA - Alberta Star Development Corp. (TSXV:ASX) (“Alberta Star” or the “Company”) announces that it has closed an asset purchase with Western Plains Petroleum Ltd. (“Western Plains”) pursuant to which the Company acquired an undivided 50% interest in all of Western Plains’ oil and natural gas interests located in the Lloydminster/Maidstone areas of Saskatchewan and the Lloydminster area of Alberta (the “Western Plains Assets”) for the cash purchase price of $1.7 million, subject to usual industry adjustments, (the “Alberta Star Transaction”) such transaction having an effect date of July 1, 2010.
The Alberta Star Transaction represents the Company’s initial diversification into the oil and natural gas resource sector and the acquisition of revenue producing resource assets to complement it’s existing advanced stage mining interests and provides the Company with a reputable working interest partner for future expansion in the oil and natural gas resource sector.
Oil and Natural Gas Operations Update
As a result of the Alberta Star Transaction, the Company is pleased to announce that its jointly owned farm-out well on Section 6-50-25 W3M is currently producing at a gross rate of approximately 70 bbls/d. The well was drilled pursuant to a farm-out with Arctic Hunter Uranium Inc. (“Arctic Hunter”) in July 2010. Under the terms of the farm-out, Arctic Hunter paid 100% of the costs to drill, complete and equip the well to earn a 100% working interest before payout, reserving to Alberta Star and Western Plains a convertible overriding royalty of 10% until payout. After payout, Alberta Star and Western Plains Petroleum Ltd. has the option to either convert to a 50% working interest in the well spacing unit or remain in a gross overriding royalty position.
The Company and Western Plains are also planning to drill, on a 50/50 basis, 4 additional wells adjacent to the Arctic Hunter farm-out well, all targeting the same zone. Licensing applications for these wells are anticipated to be submitted next week, and subject to receipt of applicable approvals and rig availability, drilling of the 4 wells is expected to be conducted in late August and early September, 2010.
The Company and Western Plains are also proposing a 6 well in-fill drilling program to commence in the fourth quarter of 2010 all of which are located in the Lloydminster Area of Saskatchewan.
The Company and Western Plains will be participating on a 50/50 basis in this drilling program on these assets.
ALBERTA STAR DEVELOPMENT CORP.
The Company is a Canadian resource exploration and development company that identifies, acquires and finances oil and natural gas assets in Western Canada and advanced stage mineral exploration projects in North America. The Company maintains a strong balance sheet and a qualified management team in exploration and development of natural resources. The Company is committed to creating long term shareholder value through the acquisition, exploration and development of petroleum and natural gas resources and the discovery of base and precious metals and by seeking to acquire additional exploration, development and production resource projects.
Investors are welcomed to contact Benjamin Curry of Progressive I.R. Consultants Corp. at (604) 689-2881, the Company’s Investor Relations specialists for all corporate updates, and investor inquiries, or Morgan Brewster, Corporate Development of the Company at (778) 989-2739 or email@example.com.
FOR FURTHER INFORMATION, PLEASE CONTACT:
Tim Coupland, President and CEO
Alberta Star Development Corp.
Tel (604) 681-3131 Fax (604) 408-3884
Neither the TSX Venture Exchange nor its Regulation Services Provider (as the term is defined in the Policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Certain information in this Press Release is forward-looking within the meaning of certain securities laws, and is subject to important risks, uncertainties and assumptions. This forward-looking information includes, among other things, information with respect to Alberta Star’s beliefs, plans, expectations, anticipations, estimates and intentions, including the completion and success of future drilling and development activities, the performance of existing wells, the performance of new wells, general economic conditions, availability of required equipment and services and prevailing commodity prices. The words “may”, “could”, “should”, “would”, “suspect”, “outlook”, “believe”, “anticipate”, “estimate”, “expect”, “intend”, “plan”, “target” and similar words and expressions are used to identify forward-looking information. The forward-looking information in this Press Release describes Alberta Star’s expectations as of the date of this Press Release.
Material factors which could cause actual results or events to differ materially from such forward-looking information include, among others, risks arising from general economic conditions and adverse industry events, risks arising from operations generally, changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses, and health, safety and environmental risks), commodity price and exchange rate fluctuations; reliance on contractual rights such as licenses and leases in the conduct of its business, reliance on third parties, reliance on key personnel, possible failure of the business model or business plan or the inability to implement the business model or business plan as planned, competition, environmental matters, and insurance or lack thereof.
Alberta Star cautions that the foregoing list of material factors is not exhaustive, is subject to change and there can be no assurance that such assumptions will reflect the actual outcome of such items or factors. When relying on Alberta Star’s forward-looking information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Alberta Star has assumed a certain progression, which may not be realized. It has also assumed that the material factors referred to in the previous paragraph will not cause such forward-looking information to differ materially from actual results or events.
The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.