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Arsenal Energy Inc. and Geocan Energy Inc. announce execution of Arrangement Agreement.

Article Excerpt
CALGARY, Aug. 8 /PRNewswire-FirstCall/ -- Arsenal Energy Inc. (TSX: AEI) ("Arsenal") and GEOCAN Energy Inc. (TSX: GCA) ("GEOCAN") are pleased to announce that they have entered into an arrangement agreement (the "Arrangement Agreement") providing for the acquisition by Arsenal of GEOCAN pursuant to a plan of arrangement under the Business Corporations Act (Alberta) (the "Arrangement"). Under the Arrangement, Arsenal will acquire all of the outstanding class "A" common shares of GEOCAN ("GEOCAN Shares") for consideration of $0.70 per GEOCAN Share, payable, at the election of each GEOCAN shareholder, in cash or 0.81 of a common share of Arsenal ("Arsenal Shares"). The consideration to be paid by Arsenal under the Arrangement of $0.70 per GEOCAN Share represents a premium of 29% over the five day weighted average trading price of the GEOCAN Shares to and including August 7, 2008 of $0.541. The value of the total consideration to be paid by Arsenal for the GEOCAN Shares, based upon a share value of $0.865 for each Arsenal Share and taking into account assumed debt of approximately $8 million, is approximately $47.2 million.

A maximum aggregate of $30,000,000 and a minimum aggregate of $26,000,000 in cash will be payable to the GEOCAN shareholders under the Arrangement. In the event that the GEOCAN shareholders elect, in the aggregate, to receive more than $30,000,000 in cash, the amount of cash to be received by a holder electing to receive cash with respect to a GEOCAN Share will be reduced proportionately and the balance of the purchase price...

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