Kenartha
KJ5 on the Frankfurt Exchange
 
Kenartha oil and gas limited Seeks Expansion into Hydro-Electric Generation - (Jan. 24, 2007)

Toronto, Ontario - Kenartha Oil & Gas Company Limited (Frankfurt Exchange: KJ5), an explorer and developer of natural gas resources, is pleased to announce that it is negotiating to participate in small hydro-electric (30 megawatts or less) generating stations in the country of Brazil. During the past four years Kenartha has investigated and explored these run-of-river potential opportunities. The Brazilian Government and its Regulatory Bodies encourage independent development of projects less than 30 MW such that the rules allow direct negotiation with the National Agency of Electric Energy, eliminating the public tendering format.

Site licenses are granted for periods of 30 to 35 years, after which they are renewed by agreement with the National Agency of Electric Energy. There is no provision for the transfer of the license and project back to the State. The electric power can be marketed under Power Purchase Agreements (PPA) to the State utility grid or National utility grid backed by sovereign guarantees, or to credible offtakers in the private sector.

Kenartha is negotiating with a private group that currently has site licenses complete with all required approvals and permits to construct two (2) hydro-electric generating stations; one of 8MW (PCH Renic project) and the other of 17.5MW (PCH Tamboril project). The estimated cost to complete these projects are for Renic US$8 million and for Tamboril US$18 million. These two projects are located downriver from a recently completed 28MW generating station constructed on a license owned by the same private group and built under a turnkey contract.

Management is of the opinion a participation interest will give the company a low risk entry point in which to seek whether there are additional business potentials in the region, and at the same time that those business potentials provide attractive returns. The private group has the opportunity to gain additional sites in the future.

About Kenartha Oil and Gas Company Limited

Kenartha Oil & Gas Company Limited (Kenartha) is an oil and natural gas exploration, acquisition, development and production firm.

The Company holds interests in natural gas production facilities in southern Ontario, Canada near Canada's first oil wells. Kenartha has sales agreements with Union Gas Limited for the purchase of its natural gas production.

Kenartha is traded on the Frankfurt Exchange under the symbol “KJ5”. For further information please visit the company’s website at kenartha.com.

WARNING: The company relies upon litigation protection for "forward-looking" statements.

Information presented in this newsletter contain 'forward looking statements' within the meaning of Section 27A of the Securities Act of 1933 and Section 21B of the Securities Exchange Act of 1934. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, goals, assumptions or future events or performance are not statements of historical fact and may be 'forward looking statements.' Forward looking statements are based on expectations, estimates and projections at the time the statements are made that involve a number of risks and uncertainties which could cause actual results or events to differ materially from those presently anticipated. Forward looking statements in this action may be identified through the use of words such as 'projects', 'foresee', 'expects'', 'will,' 'anticipates,' 'estimates,' 'believes,' 'understands' or that by statements indicating certain actions 'may,' 'could,' or 'might' occur.

For further information contact:

Mr. Ernest Harrison, EM, CEO
Mr. Marty Martinello, B.A., V.P.
Phone: 705-474-7282
Fax: 705-474-5491
Email: ernie@kenartha.com
  Mr. Robert Chase, B.A., CFO
Phone:416-368-9595
Fax:  416-368-6827
Email: rob@kenartha.com
 


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