SAN DIEGO, Jan. 23, 2007 (PRIME NEWSWIRE) -- Surge Global Energy, Inc. (OTCBB:SRGG) ("Surge"), and its wholly-owned Canadian subsidiary Cold Flow Energy, ULC ("Cold Flow") today announced board approval for a new strategic initiative to pursue low-risk high-return projects in the Canadian Oil Sands. By continuing its quest to aggregate and exploit over one billion barrels (net equity and working interest) of Oil Sands Bitumen In Place (OBIP) in large size properties in the Peace River and Athabasca regions of Alberta, Canada, Surge is on the path over the next three years to execute its business strategy in four-steps that include:
(1) Land/Lease Acquisition -- more than 200 gross square miles
(137,000 acres) holding an estimated 4.2 billion barrels of gross
certified oil in place have already been identified and in the
process of being acquired for a net equity and working interest of
942 Million Barrels of OBIP (after the Peace Oil transaction is
consummated and including Signet we anticipate 377 million barrels
of net recoverable). Over the next 3 years Surge plans to acquire
up to 400 square miles at land sales to increase oil in place to
10 billion gross barrels or 1 billion net barrels.
(2) Resource(a) Validation -- Three horizontal wells and six
stratigraphic ("strat") wells have already been drilled.
Additional strat wells will be drilled on all properties to
confirm reservoir thickness and quality and the character of the
oil. Additional seismic will be acquired to confirm the areal
extent of each oil accumulation.
(3) Converting the certified Resources into Probable Reserves(b). A
number of strat wells will be cased and tested on each property. A
limited number of horizontal wells will be drilled to conduct
pilot tests to determine well productivity.
(4) Converting sufficient of the Probable Reserves into Proven
Reserves to comprehensively prove commercial viability. A
comprehensive reservoir/production model will be created from the
data acquired to this point and will be tested against various
existing heavy oil technology alternatives and successful current
production projects to determine the optimum development plan for
the projects.
(a) Resources refer to oil proven to exist in the ground but which
may/or may not be economic to extract.
(b) Reserves implies that they can be economically extracted.
As a validation to its Land/Lease and Resource Validation strategy through its wholly-owned Canadian subsidiary Cold Flow Energy, ULC ("Cold Flow"), Surge deposited into escrow an additional deposit of $450,000 Cdn. on January 16, 2007 thus extending the acquisition closing date until March 2007. Effective at the closing of the Acquisition, Peace Oil will become a wholly owned subsidiary of Cold Flow. On November 30, 2006, the Company entered into a Stock Purchase Agreement with Cold Flow, Peace Oil, and shareholders of Peace Oil. Pursuant to the terms of the Stock Purchase Agreement, the parties agreed that Cold Flow will purchase all of the issued and outstanding shares of the capital stock of Peace Oil for a total purchase price of $16,350,000 Cdn., which consists of $6,350,000 Cdn. in cash and an aggregate of 8,965,390 exchangeable shares of preferred stock of Cold Flow. The Balance due to Peace Oil upon closing will be $5,750,000 Cdn.
Surge CEO David Perez said, "I am pleased to announce that during the past three months the Surge Board of Directors have worked diligently to assist me in developing our new four-step business strategy."
In addition, the company has retained Granite Financial Group as its financial advisor on a non-exclusive basis to secure up to $10 million dollars in equity and debt financing. The use of proceeds will be for the acquisition of Peace Oil Corp. and for its related share of drilling delineation wells in the Peace River and Athabasca oil sands.
The next update of Surge and Peace Oil's exploration activities in Alberta is planned for a shareholder conference call on February 5, 2007 at 8:00 A.M. Pacific Time. Please visit our website later this week for teleconference details.
About Surge Global Energy, Inc.
Surge Global Energy, Inc., located in San Diego, California is on a quest to aggregate and exploit one billion (net) barrels of OBIP of oil sands properties in the Peace River and Athabasca regions of Alberta Canada. For more information on the company please visit http://www.SurgeGlobalEnergy.com.
The Surge Global Energy, Inc. logo is available at http://www.primezone.com/newsroom/prs/?pkgid=2471
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include the statements regarding the Company's expectations, hopes or intentions regarding the future, including, but not limited to, general economic conditions, market and business conditions; potential production and industry capacity and estimates. Forward-looking statements involve certain risks and uncertainties, and actual results may differ materially from those discussed in any such statement. Those risks and uncertainties include the possibility Signet will not determine it is feasible to drill all 10 wells at Sawn Lake in Alberta, Canada or that if Signet does drill, it will not discover oil or gas in the quantities the Company currently anticipates. Other risks and uncertainties of the Company's business could cause actual results to differ and are discussed under the heading "Risk Factors" and in other sections of the Company's SB-2 filed with the SEC on December 20, 2006, the Company's Form 10-K for the 2005 fiscal year and in the Company's other periodic reports filed from time to time with the SEC. All forward-looking statements in this document are made as of the date hereof, based on information available to the Company as of the date hereof, and the Company assumes no obligation to update any forward-looking statements.