The Corporation has recently completed an extended geological study to select the best potential drilling locations at its properties at Woodnorth. A geologist, Ray Schwartzenberger, performed the study. The Corporation has also reached an agreement with Venture Drilling Inc. to perform drilling of at least two wells. As part of the agreement, Venture has transferred a drilling rig to the Corporation's Woodnorth properties earlier this week, prior to the seasonal road ban.
The seasonal road ban, which is expected to be implemented shortly, will require the Corporation to apply for special permission to use roads until the end of the ban period. The ban is typically lifted in May or June. Obtaining special permission depends on the discretion of the local municipal government representative and depends on the weather and the condition of the roads. The Corporation is also currently awaiting drilling permits from the Manitoba government.
The Corporation's CEO and President, Martial Rolland, says "The Corporation expects sizeable increases in its reserves and in its overall oil production as a result of this low risk drilling. The proposed drilling will take place on the Corporation's properties, near the Woodnorth battery operation, where there are operational efficiencies to be obtained. With a drilling rig already on our properties, we hope to take advantage of any windows of opportunity resulting from good weather during the road ban, to commence drilling as soon as possible."
The drilling costs are estimated to be on average approximately $300,000 per well. Should the Corporation strike oil at each of its drill sites, the costs to complete and tie-in each well are estimated to be on average an additional $250,000 per well. The Corporation's battery operation is capable of processing the fluid that might come from production of these two new wells. The Corporation will pay for most of these investments using "flow trough" funds from its previous private placement closed in last December 2006.
RECENT FINANCING ACTIVITIES
The Corporation is currently in discussions with investors to raise between $120,000 and $500,000 through an un-brokered private placement of common shares (the "Shares") and common share purchase warrants (the "Warrants"). The Closing of the private placement is expected to occur on or about March 27th, 2007. The Shares are to be issued with a price of $0.15 and the Warrants with an exercise price of $0.25 for the first year and $0.50 for the second year. Proceeds from the financing will be used for general working capital.
As announced on February 19, 2007, the Corporation raised $560,000 through a private placement of convertible debentures and warrants. As part of this private placement, the Corporation issued warrants to purchase 2,554,742 Common Shares with an exercise price equal to the conversion price of the convertible debentures. With the proceeds of this financing, the Corporation repaid $500,000 of short-term debt and refinanced $3.5 million with extended repayment periods and lower financing costs. As part of this re-financing, Rolland Energy issued 4,888,889 warrants Primatlantis Capital L.P., with an exercise price of $0.18 and a maturity date of February 29, 2009, subject to the approval of the TSX Venture Exchange.
Previously known as RVBS, Rolland Energy is an oil and gas Corporation with subsidiary operations in information technology. Its oil and gas operations are based in southwestern Manitoba. The Corporation intends to sell its information technology division.
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