Bonanza Creek Buys Private Company With Arkansas Producing Assets

Bonanza Creek Energy Company, LLC announced that on April 11, 2008 it closed a significant producing property acquisition in southwest Arkansas from Macquarie Oil and Gas Holdings Inc., a subsidiary of Macquarie Group Limited, for an undisclosed price.

The acquisition properties, located in Union, Lafayette and Columbia counties, are currently producing approximately 1200 BOE per day (70% oil and natural gas liquids) and provide significant development and exploration upside in the Cotton Valley, Travis Peak, Rodessa, James Lime and Lower Smackover formations. The properties include 93 producing wells (68 operated) with an average working interest of 73% and 15,100 gross acres (12,237 net acres). Proved reserves are nine million BOE with an additional four million BOE probable and possible reserve upside. The Company has identified over $50 million of investment opportunities in the proved reserve base, which they plan to develop within the next three to four years. Included in the acquisition is a 15 million SCFPD gas plant with 225 miles of gathering system, which processes production from both the properties and other producers in the area.

"This purchase for Bonanza Creek increases the Company's proved reserves to over 19 million BOE with a PV-10 of $420 million (year-end prices held constant), of which approximately $200 million is proved producing," states Michael Starzer, President & CEO of Bonanza Creek. "To date, the Company's developed reserve F&D cost is an attractive $18 per BOE. Full life cycle F&D cost is projected at $16 per BOE, increasing production to over 4700 BOEPD within the next four years. Gary Grove, Chief Operating Officer for Bonanza Creek states, "During the past two years the Company has increased PV-10 twenty fold and proved reserves over ten fold. The Company has acquired 112,000 acres of fee and leasehold with an additional 74 million BOE probable and possible reserve upside valued at over $1,025 million."

"Equally attractive with the assets is the combination of sixty personnel with a proven record of value creation," states Mr. Starzer. "The opening of our Houston office under the leadership of Burt Williams will expand Bonanza Creek's exposure to growth opportunities in the Gulf Coast and Mid-Continent regions in concert with our Rocky Mountain and Western Region holdings." Mr. Starzer further stated, "I wish to thank our investors, Laminar Direct Capital and the Berry Family investor group, along with the Company's excellent employees for their continued support in Bonanza Creek's growth objectives."

Todd Overbergen, a director of Laminar Direct Capital L.P. and a senior vice president of D. E. Shaw & Co., L.P. states, "We dedicate significant attention to the energy sector, and are extremely excited about Bonanza Creek's acquisition and plans to open a Houston office. Mike, Gary, and their staff did an outstanding job of identifying, evaluating, and closing this transaction. We look forward to this next step in the growth and value creation of Bonanza Creek." Hank Bennett, Chairman of Bonanza Creek, states, "On behalf of the Berry Family, we are pleased with the ability of the Company to find attractive investments and look forward to aggressively expanding operations in the Gulf and Mid-Continent Regions."

Rivington Capital Advisors, LLC served as financial advisor and Thompson & Knight, LLP served as legal advisor to Bonanza Creek for the acquisition.