GEOCAN Closes Sale of Heavy Oil Assets for $50.9 Million

GEOCAN Energy Inc. has closed its previously announced sale of the Lloydminster area heavy oil assets for $50.9 million, inclusive of closing adjustments. The effective date for the Lloydminster area transaction is February 1, 2008. The closing of the previously announced Carrot Creek asset sale is scheduled for mid March.

GEOCAN currently has production of approximately 1,000 BOE/d (95% operated); split 37% light and medium oil and 63% natural gas. GEOCAN is strategically focused within three core areas, namely, east central Alberta, west central Alberta and northeastern British Columbia. GEOCAN holds 137,000 gross (88,132 net) undeveloped acres of land within its three core areas and has estimated current tax pools of approximately $43 million. On March 3, 2008 GEOCAN finalized its new $17 million revolving operating demand loan facility with its existing lender. Upon closing the Carrot Creek transaction, GEOCAN's debt and working capital deficiency is anticipated to be approximately $3 million.