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Avatar Energy to Receive $3.12 M Gross Proceeds for Pembina Strawberry Creek Properties

Avatar Energy Ltd. (AVG.V) has entered into a binding letter agreement to sell its working interest in properties located in the Pembina Strawberry Creek area to an arm's length third party for cash gross proceeds of $3.12 million. The Transaction will close in two tranches with the first tranche (for $1,120,000) expected to close on November 30, 2012 and the second tranche (for $2,000,000) expected to close on or before February 15, 2013.

The Corporation's Pembina Strawberry Creek properties represent approximately 5% of Avatar's proved reserves as at December 31, 2011, and 27% of Avatar's non-current assets as at June 30, 2012.

The net proceeds from the Transaction will be used to repay all indebtedness owing under Avatar's credit facility, satisfy other liabilities and for general corporate purposes. A finder's fee of $124,800 will be paid to CB Securities Inc. for services provided as financial advisor to the board of directors with respect to the strategic review process.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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