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Arcan Resources Ltd. is a high-growth junior producer with a balanced portfolio of assets located in the Deer Mountain, McLeod and Hamburg areas. The Company achieved a public listing through the RTO amalgamation of Desco Energy Ltd. and Arcan Resources Ltd. Arcan began trading on the TSX Venture exchange under the symbol “ARN” on January 09, 2007.

Ahead of schedule and on-targets --- On February 19, 2010 Arcan announced results of the first well, the Acquisition and the Equity deal.  With that Arcan assembled a presentation which included our 2010 plans; drill 7-9 HZ wells out of cash flow and existing banklines; Average 2,500 - 3,000 boe per day in 2010 and exit at 3,500 - 4,000 boe per day.  To August 19, 2010 (our Q2 reporting date) 12 HZ wells have been drilled with 8 of them on production (inside our previously existing banklines), production crossing the 3,000 boe per day mark, and we still anticipate being over the 2,500 boe per day in 2010 in spite of weather related issues in Alberta. 

Corporate Highlights

Focus on the Swan Hills Beaverhill Lake

• 140+ net sections of undeveloped lands in the Beaverhill lake formation in the Swan Hills reef complex;
• Arcan\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\'s two oil properties Swan Hills and Hamburg are operated, under waterflood and produce light sweet oil (40º+ API);
• Arcan\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\'s first horizontal wells completed with a multi-stage frac in our Swan Hills play started at over 500-600 barrels per day;
• Arcan has drilled 12 Horizontal wells which will of which will be completed and on production in Q3;
• Through careful preparation and execution, Arcan already has over 20 additional locations in the drill ready stage; and
• Arcan estimates it has a significant drilling inventory of over 220 horizontal locations in the Swan Hills play.

2009 Highlights

• Net asset  value $3.08 per diluted share (P+P 10%) of which only 22 cents is land and seismic;
• Year end 2009 reserves exclude the results of the new horizontal wells and are only on approximately 8 net sections of land out of the 60 net sections of Swan Hills lands that Arcan held at year end 2009 (Arcan now holds over 150 gross (140 net) sections of land on the Swan Hills reef after the Acqusition);
• Production of 1,375 boe/d;
• 19 year reserve life;
• P+P reserves of 9.4 Mboe, 76% proved and 89% light oil;
• P+P FD&A cost of $14.29 per boe;
• Operating netback of $24.10 per boe;
• Recycle ratio of 1.7 times; and
• Spud our first horizontal well in the Swan Hills.