BLACKPEARL ANNOUNCES SECOND QUARTER 2011 FINANCIAL AND OPERATING RESULTS

CALGARY, ALBERTA - BlackPearl Resources Inc. ("BlackPearl" or the "Company")
(TSX:PXX) (FIRST NORTH:PXXS) is pleased to announce its financial and operating
results for the three and six  months ended June 30, 2011.


Second quarter highlights include:

 

  • Completed construction of facilities and commenced steam injection at our
    Blackrod SAGD pilot project;
  • Completed construction of facilities at Mooney and commenced polymer
    injection in early July;
  • Drilled 63 conventional development wells at Onion Lake;
  • At Onion Lake, we also filed a SAGD commercial development application with
    regulatory authorities in July;
  • Revenues increased 23% to $42.0 million compared to Q2 in 2010;
  • Cash flow from operations increased 37% to  $18.8 million compared with
    $13.8 million in Q2 2010;
  • Maintained a strong balance sheet with working capital of $84.9 million and
    no debt after incurring capital expenditures of $95.2 million in the first
    half of the year.

 

John Festival, President of BlackPearl, commenting on Q2 2011 activities
indicated that “we are extremely pleased with the milestones achieved in the
first half of the year. Our goal when we joined BlackPearl was to validate the
potential of the properties and then commence development of these core areas.
We have made major strides this quarter with the completion of the polymer
facilities at Mooney and the commencement of operations on the thermal SAGD
pilot at Blackrod. In addition, We made significant progress at Onion Lake, not
only in maintaining our conventional drilling program but also advancing our
SAGD development plans with the filing of a commercial development application
for the area.

 

Our production growth in Q2 was hampered by forest fires and wet weather, but
these are temporary issues, and we should have a strong second half of the
year, with year-end production still targeted at 11,000 barrels of oil per
day.”

 

The 2011 second quarter report to shareholders, including the financial
statements, management's discussion and analysis and notes to the financial
statements are available on the Company's website (www.blackpearlresources.ca)
or SEDAR (www.sedar.com).

 

 

Forward-Looking Statements

This news release contains certain forward-looking statements and
forward-looking information (collectively referred to as “forward-looking
statements”) within the meaning of applicable Canadian securities laws. All
statements other than statements of historical fact are forward-looking
statements. Forward-looking information typically contains statements with
words such as “anticipate”, “believe”, “plan”, “continuous”, “estimate”,
“expect”, “may”, “will”, “project”, “should”, or similar words suggesting
future outcomes. In particular, this document contains forward-looking
statements pertaining to the Company's estimated production levels, future
operating costs, resource estimates at Blackrod as well as potential production
levels from the area, development plans at Onion Lake, Blackrod and Mooney, and
future drilling locations at Onion Lake.

 

Statements relating to reserves and contingent resources are forward-looking,
as they involve the implied assessment, based on certain estimates and
assumptions, that the reserves and contingent resources described exist in the
quantities predicted or estimated and can profitably be produced in the future.

 

Undue reliance should not be placed on forward-looking statements, which are
inherently uncertain, are based on estimates and assumptions, and are subject
to known and unknown risks and uncertainties (both general and specific) that
contribute to the possibility that the future events or circumstances
contemplated by the forward-looking statements will not occur. There can be no
assurance that the plans, intentions or expectations upon which forward-looking
statements are based will be realized. Actual results will differ, and the
differences may be material and adverse to the Company and its shareholders.

 

With respect to forward-looking statements contained in this press release,
management has made assumptions regarding future production levels; future oil
and natural gas prices; future operating costs; timing and amount of capital
expenditures; the ability to obtain financing on acceptable terms; availability
of skilled labour and drilling and related equipment; general economic and
financial market conditions; continuation of existing tax and regulatory
regimes; and the ability to market oil and natural gas successfully to current
and new customers. Although management considers these assumptions to be
reasonable based on information currently available to it, they may prove to be
incorrect.

 

By their very nature, forward-looking statements involve inherent risks and
uncertainties (both general and specific) and risks that the goals or figures
contained in forward-looking statements will not be achieved. These factors
include, but are not limited to, risks associated with fluctuations in market
prices for crude oil, natural gas and diluent, general economic, market and
business conditions, substantial capital requirements, uncertainties inherent
in estimating quantities of reserves and resources, extent of, and cost of
compliance with, government laws and regulations and the effect of changes in
such laws and regulations from time to time, the need to obtain regulatory
approvals on projects before development commences, environmental risks and
hazards and the cost of compliance with environmental regulations, aboriginal
claims, inherent risks and hazards with operations such as fire, explosion,
blowouts, mechanical or pipe failure, cratering, oil spills, vandalism and
other dangerous conditions, potential cost overruns, variations in foreign
exchange rates, diluent supply shortages, competition for capital, equipment,
new leases, pipeline capacity and skilled personnel, uncertainties inherent in
the SAGD bitumen recovery process, credit risks associated with counterparties,
the failure of the Company or the holder of licences, leases and permits to
meet requirements of such licences, leases and permits, reliance on third
parties for pipelines and other infrastructure, changes in royalty regimes,
failure to accurately estimate abandonment and reclamation costs, inaccurate
estimates and assumptions by management, effectiveness of internal controls,
the potential lack of available drilling equipment and other restrictions,
failure to obtain or keep key personnel, title deficiencies with the Company's
assets, geo-political risks, risks that the Company does not have adequate
insurance coverage, risk of litigation and risks arising from future
acquisition activities. Further information regarding these risk factors may be
found under “Risk Factors” in the Annual Information Form. Readers are
cautioned that these factors and risks are difficult to predict and that the
assumptions used in the preparation of such information, although considered
reasonably accurate at the time of preparation, may prove to be incorrect.
Accordingly, readers are cautioned that the actual results achieved will vary
from the information provided herein and the variations could be material.
Readers are also cautioned that the foregoing list of factors is not
exhaustive. Consequently, there is no representation by the Corporation that
actual results achieved will be the same in whole or in part as those set out
in the forward-looking information. Furthermore, the forward-looking statements
contained in this report are made as of the date hereof, and the Corporation
does not undertake any obligation, except as required by applicable securities
legislation, to update publicly or to revise any of the included
forward-looking statements, whether as a result of new information, future
events or otherwise. The forward-looking statements contained herein are
expressly qualified by this cautionary statement.

 

(For full report and tables, see attached file)

 

For further information, please contact:

 

 

John Festival - President and Chief Executive    Don Cook - Chief Financial
Officer                                          Officer

Tel.: (403) 215-8313                             Tel: (403) 215-8313

                                                  

                                                  


 

 

BlackPearl's Certified Advisor on First North is E. Öhman J:or Fondkommission
AB.

Company Registration Number:   409596-1

The report for the three months ending September 30, 2011 will be published on
or before November 14, 2011.