Press Releases
08/27/2008

Osum Oil Sands Corp Announces $275 Million Financing

August 27, 2008 – Calgary, Canada – Osum Oil Sands Corp (“Osum”), a privately-held company focused on bitumen extraction, today announced that it has closed a private equity financing for a total of CDN $275 million at a price of CDN $10.50 per share. The financing was led by Warburg Pincus LLC (“Warburg Pincus”) and included a substantial investment by Blackstone Capital Partners V LP (“Blackstone”).

Osum is currently the only junior player with a material position in the thermal trend of the Cold Lake oil sands region of Canada, where a substantial majority of the country’s current “in situ” bitumen is produced. Producers operating in the area include Imperial Oil, Canadian Natural Resources, Shell and Husky. Osum plans to file its commercial application at Cold Lake in late 2009, with first production anticipated in 2013.

Osum’s Chairman and CEO, Richard Todd, said, “The closing of this most recent financing is a positive endorsement of our quality asset base and management team. The caliber of private equity firms committed to this financing suggests a solid base of access to capital going forward for our company. These funds provide the opportunity for Osum to confidently move forward to first commercial production from our Cold Lake bitumen project of approximately 35,000 barrels per day, and to pilot production at our much larger Saleski project in the Wabasca region of Alberta., where our significant land position holds the potential to produce in excess of 150,000 barrels per day from several projects.”

Mr. Todd continued, “The Saleski carbonates are thought by many to be one of the world’s next giant oil plays, and we are well-positioned to capitalize on this opportunity to unlock a significant bitumen resource in Alberta. We expect an application will be filed for large-scale commercial development at one of our Saleski projects shortly after receipt of our first pilot results, which are expected in early 2010. In short, the financing we have received strengthens our momentum going forward, and we look forward to taking advantage of multiple opportunities ahead of us.”

The company also reported that, as part of its new financing, it is adding Jeffrey Harris and David Krieger, both Managing Directors of Warburg Pincus, and David Foley, Senior Managing Director of Blackstone to its Board of Directors. Two of the company’s existing Directors, Simon Clark and Gerry Stephenson, have agreed to step down from the Board of Directors and will join Osum’s newly formed Board of Advisors.

Jeffrey Harris stated, “On behalf of Warburg Pincus, we are thrilled to partner with Richard Todd and Osum’s highly experienced management team to help build the company into one of the premier oil sands operators in Canada. Osum presents a unique opportunity to participate in one of the few remaining independent oil sands plays of substantial scale in the primary fairway in Canada.”

David Foley, from Blackstone added, “We are pleased to have the opportunity to play an active role in funding the continued growth of a company with such significant recoverable resources and as experienced a management team as Osum’s.”

About Osum:

Osum Oil Sands Corp. is a privately held Alberta based company with approximately 11 billion barrels of bitumen in place net to Osum, focused on the application of in situ recovery technologies to bitumen extraction. Osum’s mission is to provide secure, safe energy to North Americans through innovative and environmentally responsible business practice. For more information, please visit www.osumcorp.com.

About Warburg Pincus:

Warburg Pincus has been a leading private equity investor since 1971. The firm currently has more than $35 billion of assets under management. Over the past 20 years, Warburg Pincus has invested more than $3.4 billion in more than 30 companies in the energy-sector worldwide. The firm has been the lead investor in numerous successful public and private oil and gas exploration and production companies, including: Newfield Exploration Co. (NYSE: NFX), Spinnaker Exploration, Inc. (since acquired by Norsk Hydro ASA), Encore Acquisition Company (NYSE: EAC), Bill Barrett Corp. (NYSE: BBG), MEG Energy Corp., Antero Resources Corp., and Canbriam Energy. Warburg Pincus has an active portfolio of more than 125 portfolio companies, and has offices in Beijing, Frankfurt, Hong Kong, London, Mumbai, New York, San Francisco, Shanghai and Tokyo. For more information, please visit www.warburgpincus.com.

About Blackstone:

Blackstone (NYSE: BX) is one of the world’s leading investment and advisory firms with total assets under management of approximately $119 billion and a long and distinguished track record of investing in the energy sector. Blackstone seeks to create positive economic impact and long-term value for its investors, the companies it invests in, the companies it advises and the broader global economy. Blackstone’s alternative asset management businesses include the management of corporate private equity funds, real estate funds, hedge funds, funds of funds, debt funds, collateralized loan obligation vehicles (CLOs) and closed-end mutual funds. The Blackstone Group also provides various financial advisory services, including mergers and acquisitions advisory, restructuring and reorganization advisory and fund placement service. Further information is available at www.blackstone.com.

Cautionary Information and Forward Looking Statements

Certain statements contained in this press release, including the documents incorporated by reference, may contain projections and "forward-looking statements" within the meaning of that phrase under Canadian and U.S. securities laws. When used in this document, the words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions may be used to identify forward-looking statements. Those statements re"ect our current views with respect to future events or conditions, including prospective results of operations, financial position, predictions of future actions or plans or strategies.

Certain material factors and assumptions were applied in drawing our conclusions and making those forward looking statements. By their nature, those statements re"ect management's current views, beliefs and assumptions and are subject to certain risks, uncertainties, known and unknown, and assumptions, including, without limitation, machinery development or production delays, changing environmental regulations, the ability to attract and retain business partners, the ability to exploit hydrocarbon resources with our technology, future levels of government funding, the need to obtain and maintain proprietary rights over our technology, competition from other technologies, the ability to access the capital required for research, technology development, operations and marketing, the need to generate positive cash "ow in the foreseeable future, changes in energy prices and currency levels.

Many factors could cause our actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by these forwardlooking statements. Should one or more of these risks or uncertainties materialize, or should the assumptions underlying our projections or forward-looking statements prove incorrect, our actual results may vary materially from those described in this press release as intended, planned, anticipated, believed, estimated, or expected. We do not intend and do not assume any obligation to update these forward-looking statements whether as a result of new information, plans, events or otherwise.

Our securities are not traded on any stock exchange in Canada and thus, OSUM is not subject to regulation by any Canadian stock exchange. Our securities are also not registered under the United States Securities Act of 1933 nor are they traded on any securities or stock exchange in the United States. As a result, we are not presently subject to the reporting, certification or other requirements imposed on U.S. registered issuers under, among other things, U.S. Sarbanes-Oxley Act of 2002 ("SOX").

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For Osum Oil Sands Corp:

Business Inquiries

Richard Todd

Chairman and CEO

(403) 283-3224

Media Inquiries

Justin Robinson

Communications Manager

(403) 270-4766

 

For Warburg Pincus:

Joseph Kuo or Todd Fogarty

Kekst and Company

212-521-4800

joe-kuo@kekst.com or todd-fogarty@kekst.com

 

For Blackstone:

John Ford

(212) 583-5559

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