2010-04-09-2010-02-19

To acquire 81 net sections of land in Swan Hills, Alberta, gaining 500 BOE/d, 1.08 MMBOE proved.

Arcan Resources Ltd., Calgary, (Toronto Venture: ARN) plans to acquire approximately 102 gross (81 net) sections of land in the Swan Hills area of Alberta from Celtic Exploration Ltd., Calgary, (Toronto: CLT) for C$53.25 million in cash.

Production from the assets is 500 barrels of oil equivalent per day. Proved reserves are 1.08 million barrels of oil equivalent, while proved plus probable reserves total 2 million barrels (92% oil). Acquisition cost per barrel of proved and proved plus probable reserves is expected to be C$49.40 and C$26.61, respectively. Some 80% of of the acreage has been classified as undeveloped.

Pro forma the transaction, Arcan will own a 100% interest in more than 70 sections of land near its existing infrastructure. The company estimates its land holdings contain more than 100 drilling opportunities.

In conjunction with the acquisition, Arcan plans to raise between C$30 million and C$50 million in a private placement underwritten by a syndicate of investment dealers led by Haywood Securities Inc. and including Wellington West Capital Markets Inc., Paradigm Capital Inc., and Macquarie Wealth Management. Arcan says the offering price will be "determined in the context of the market."

Celtic will use the proceeds for its 2010 drilling program and for general corporate purposes.

The acquisition is expected to close by March 31.