OilVoice - Forent Energy Announces Central Alberta Oil Farm-in Agreement

Forent Energy Announces Central Alberta Oil Farm-in Agreement

Wednesday, November 11, 2009

Forent Energy Ltd. announces that it has entered into a farm-in agreement with a major western Canadian oil and gas producer that provides the Company with a rolling option to carry out a multi-well drilling program in Central Alberta. Over the past several months Forent has been working with several major Western Canadian land holders in an effort to identify and secure drilling opportunities on undeveloped lands.

This most recent farm-in, covers 15 3/4 net sections of oil prone lands. Under the terms of the farm-in, Forent will elect to drill a test well and pay 100% of the drilling costs in order to earn a 100% working interest in the section until payout, at which time the Farmor can elect to either maintain its 10% royalty or convert to a 35% working interest. Subsequent development will be by election on a rolling option basis, with Forent having the option to either shoot seismic or drill wells to continue earning on the farm-in lands. The Company believes that the lands are well situated for potential oil discoveries with Mannville oil production in the vicinity.

Funding for the drill program will come from Forent's recently announced $3.2 million financing which closed on October 28, 2009. Forent's focus is to strengthen its financial position by developing low risk Western Canadian oil prospects in order to generate sufficient cash flow to move forward with the development of its Nova Scotia reef oil and shale gas assets.