SilverBirch Energy Corporation Launched

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CALGARY, Oct. 1 /CNW/ - SilverBirch Energy Corporation ("SilverBirch") began operations today as a newly formed oil sands exploration and development company with assets in Alberta's Athabasca oil sands area. The company was formed as a result of a plan of arrangement (the "Arrangement") between UTS Energy Corporation ("UTS") and Total E&P Canada Ltd. Pursuant to the Arrangement, former UTS shareholders received, for each common share of UTS held, cash consideration of $3.08 as well as 0.1 common shares of SilverBirch.

"SilverBirch is a new company, but with assets and a management team drawn from UTS, we are already familiar to many of our shareholders," said Howard Lutley, President and Chief Executive Officer of SilverBirch. "We are moving forward with a well-defined plan to develop the Frontier and Equinox Projects - which we believe are amongst the highest quality undeveloped oil sands mining projects remaining in Canada - towards commercial production. Concurrently, we are exploring our remaining lands to add value and to pursue opportunities for further resource additions. Our team knows the excellent potential in this asset base and we are excited to hit the ground running and to move our projects along."

SilverBirch is focused on exploring for, developing and ultimately producing hydrocarbon resources in the Athabasca oil sands area in north-eastern Alberta. The primary assets of SilverBirch include a 50% interest in the Frontier and Equinox Projects, a 50% working interest in an additional 209,280 acres of exploration oil sands leases and a 100% working interest in 23,040 acres of undeveloped lands with in situ oil sands potential.

The Frontier and Equinox Projects provide a solid foundation for the new company, with 891 million barrels of mineable contingent resources (Best Estimate) as SilverBirch's working interest share. SilverBirch currently expects to file regulatory applications for these Projects in 2011. Management anticipates that the value associated with the Frontier and Equinox Projects should increase as they progress towards regulatory approvals, which are currently expected in the 2013/2014 timeframe.

Conditional listing approval for the SilverBirch Shares issuable pursuant to the Arrangement has been received from the TSX Venture Exchange (the "TSX-V"). Provided that all of the TSX-V listing conditions are met, trading of the SilverBirch Shares on the TSX-V under the symbol 'SBE' is expected to commence at the open of the market on October 7, 2010 with the UTS Shares being delisted from the Toronto Stock Exchange (the "TSX") at the close of the market on October 6, 2010.

About SilverBirch Energy

SilverBirch Energy Corporation is a pre-production oil sands company headquartered in Calgary, Alberta, Canada. SilverBirch has a rich portfolio of mining and in situ oil sands properties, including 50% ownership of the Frontier and Equinox Projects. To learn more, please visit www.silverbirchenergy.com.

NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

Methodology

Sproule Unconventional Limited ("Sproule") has prepared an independent opinion of the contingent bitumen resources with respect to the Frontier and Equinox Projects effective June 30, 2010. Sproule's responsibility is to express an opinion on the petroleum-initially-in-place and contingent bitumen resources data based on the evaluation, audit or review. Sproule carried out the evaluation, audit or review in accordance with standards established by the Canadian Securities Administrators within National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities. Those standards require that the petroleum-initially-in-place and contingent resources data be prepared in accordance with the Canadian Oil and Gas Evaluation Handbook ("COGE Handbook") as published by the Society of Petroleum Evaluation Engineers (Calgary Chapter) and the Petroleum Society of Canada.

Contingent resources are defined in the COGE Handbook as those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies. Contingencies may include factors such as economic, legal, environmental, political and regulatory matters or a lack of markets. It is also appropriate to classify as "contingent resources" the estimated discovered recoverable quantities associated with a project in the early evaluation stage.

There is no certainty that either of the Frontier Project or the Equinox Project will produce any portion of the volumes currently classified as "contingent resources". The primary contingencies which currently prevent the classification of the contingent resources disclosed in the estimate above as reserves consist of: current uncertainties around the specific scope and timing of the development of each of the Frontier Project and the Equinox Project; lack of regulatory approvals for certain aspects of such projects; the uncertainty regarding marketing plans for production from the subject areas; improved estimation of project costs; commodity price fluctuations; and those other risks and contingencies described below and under "Risk Factors" in UTS' information circular dated August 27, 2010 (the "UTS Information Circular") related to the Arrangement which includes information about SilverBirch, on file with applicable securities regulatory authorities, and may be accessed through the SEDAR website www.sedar.com. Contingent resources do not constitute, and should not be confused with, reserves. There is no certainty that it will be commercially viable to produce any portion of the contingent resources on any of the above mentioned properties.

The Frontier Project is an oil sands mining project associated with the development of that portion of the Athabasca Oil Sands Area identified by Alberta Oil Sands Lease Nos. 311, 468, 470, 477, 610 and 840 and is located in northeastern Alberta approximately 100 kilometres north of Fort McMurray and 500 kilometres northeast of Edmonton. The Equinox Project is an oil sands project related to the development of Alberta Oil Sands Lease No. 14 located in northeastern Alberta. The Equinox Project bisects the Pierre River Project, approximately 90 kilometres north of Fort McMurray and 500 kilometres northeast of Edmonton.

Advisory Regarding Forward-Looking Information

This news release contains "forward-looking information", within the meaning of applicable securities laws. The use of any of the words "proposed", "will", "may", "anticipates", "expects", "potential", "plan", "believe" and similar expressions are intended to identify forward-looking information. More particularly and without limitation, this news release contains forward-looking information concerning: the potential of the SilverBirch asset base; the plans for development of the Frontier and Equinox Projects; the in situ oil sands potential of SilverBirch's undeveloped lands; the estimated contingent bitumen resources of SilverBirch; the expected timing of the submission of regulatory applications; SilverBirch's anticipated mine plan; the expected receipt and timing of regulatory approvals; the value and potential of the Frontier and Equinox Projects; the listing and trading of the SilverBirch Shares; and the delisting of the UTS Shares.

Information relating to "resources" is forward-looking information, as it involves the implied assessment, based on estimates and assumptions that the resources exist in the quantities predicted or estimated, and can be profitably produced in the future.

The forward-looking information in this news release is based on certain key expectations and assumptions made by SilverBirch, including assumptions as to: the submission, in a timely manner, of regulatory and third party applications in respect of the Frontier and Equinox Projects; the receipt, in a timely manner, of regulatory and third party approvals in respect of the Frontier and Equinox Projects; the timing and progress of work relating to the Frontier and Equinox Projects; SilverBirch's geological and engineering estimates; continuity of resource between core holes; future production levels; the regulatory framework with respect to royalties, taxes, environmental matters, resource recovery and securities matters in the jurisdiction in which SilverBirch will conduct its business; the anticipated timing and receipt of final listing approval from the TSX-V and the anticipated timing of the delisting of the UTS Shares. Although UTS believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because UTS can give no assurance that it will prove to be correct.

The forward-looking information in this news release is subject to known and unknown risks and uncertainties and other factors which may cause actual results to differ materially from those expressed or implied in the forward-looking information. Such risks, uncertainties and factors include, among others, inability to secure necessary regulatory or other third approvals with respect to the Frontier and Equinox Projects in the time assumed or at all; the early stage of development of SilverBirch and its assets and the nature of the exploration and development activities on such assets, risks associated with contingent bitumen resources and mine pit estimates and difficulties encountered during the exploration for, delineation, development and production of bitumen. In general, estimates of bitumen are based upon a number of factors and assumptions made as of the date on which the resource estimates were determined, such as geological and engineering estimates, certain TV:BIP ratios and pit boundaries, which have inherent uncertainties. Further risks, uncertainties and factors include an inability to secure necessary regulatory or other third approvals in the time assumed or the need for additional time to satisfy the conditions of the TSX-V with respect to the listing of the SilverBirch Shares on the TSX-V or the conditions of the TSX with respect to the delisting of the UTS Shares. As a result of the foregoing, readers should not place undue reliance on the forward-looking information contained in this news release.

Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect the operations or financial results of SilverBirch are included in the UTS Information Circular on file with applicable securities regulatory authorities and may be accessed through the SEDAR website www.sedar.com.

The forward-looking information contained in this news release is made as of the date hereof and UTS and SilverBirch undertake no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

For further information: Howard J. Lutley, President and Chief Executive Officer, SilverBirch Energy Corporation, [phone]