CALGARY, Dec. 1 /CNW/ - Eagle Rock Exploration Ltd. ("Eagle Rock" or the "Company") (TSXV:ERX) announces that it has entered into formal binding agreements for the arm's length acquisition of the outstanding shares of three private oil & natural gas companies (collectively, the "Privatecos") for an aggregate cash consideration of $4.5 million. The purchase price is comprised of approximately $4.1 million for petroleum and natural gas interests and $0.4 million for working capital. No debt is being assumed by Eagle Rock on this transaction.

As previously announced, the acquisitions of the Privatecos are expected to add production of approximately 28 bbls/day oil and 390 mcf/d natural gas. Collectively, the Privatecos hold a 100% working interest and operatorship in a natural gas property in the Conrad area of southern Alberta and a 74.5% working interest and operatorship in an oil property in the Beverley area of southwest Saskatchewan. The Beverley property includes a facility which will accommodate the Company's current production from the area and thereby eliminate third party processing costs.

The formal agreements provide for an effective date for the acquisitions of October 1, 2008. The acquisitions do not include any commitments for office facilities or employees.

The Company's demand revolving credit facility with a Canadian chartered bank increased to $15.5 million (previously $9.0 million) in anticipation of this acquisition and in light of production increases. The demand development credit facility has also increased to $4.0 million from $3.5 million. The development facility has been drawn as of this date to finance capital expenditures incurred in Q3 and Q4 2008.

The revolving facility incurs interest at the bank's prime lending rate (currently 4.0%) plus 0.375% and the development facility incurs interest at the bank's prime lending rate plus 0.75%. The development facility also requires principle payments of $100,000 per month commencing February 1, 2009. The credit facilities are subject to review by March 31, 2009.

The acquisitions of the three Privatecos are expected to close on or about December 15, 2008, and will be subject to the valid deposit of at least 90% of the outstanding shares of one of the Privatecos no later than December 15, 2008, and regulatory approval.

About Eagle Rock

Eagle Rock Exploration Ltd. is a publicly traded energy company involved in the exploration and development of low to medium risk oil and gas properties in Western Canada.

Eagle Rock Exploration Ltd. trades on the TSX Venture Exchange under the symbol ERX.

For more information please visit us at www.eaglerockexploration.com

The TSX Venture Exchange does not accept responsibility for the adequacy
or accuracy of this release.

Forward-looking Information

This press release includes forward-looking statements and assumptions respecting Eagle Rock's strategies, future operations, expected financial results, financial sources, commodity prices, costs of production and quantum of oil and natural gas reserves and discusses certain issues, risks and uncertainties that can be expected to impact on any of such matters. By their nature, forward-looking statements are subject to numerous risks and uncertainties that can significantly affect future results. Actual future results may differ materially from those assumed or described in such forward-looking statements as a result of the impact of issues, risks and uncertainties whether described herein or not, which Eagle Rock may not be able to control. The reader is therefore cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements contained in this news release are made as of the date hereof and Eagle Rock undertakes no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement. In addition, the term BOE or BOE's may be misleading, particularly if used in isolation. A BOE (barrel of oil equivalent) conversion ratio of 6 Mcf per one (1) BOE is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

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