Canada based Tuscany International Drilling Inc. has entered into a letter of intent to acquire all of the issued and outstanding shares of a private Brazilian drilling and work-over company, together with seven drilling rigs and two work-over rigs located in Brazil from an affiliate of the Company, for an aggregate cash purchase price of approximately US$52 million, announced Tuscany Wednesday.

Of the nine rigs to be acquired, two drilling rigs are on long-term contracts and one drilling rig is on a year-to-year contract. The acquisition is expected to close on or about April 30, 2011, subject to various conditions, inclusive of completion of binding definitive agreements and other regulatory approvals.

Currently, the Company generates annual EBITDA of approximately US$6 million. Tuscany anticipates that it will invest approximately US$10 million to refurbish some of the rigs in the Company's fleet with the anticipated result of increasing the Company's EBITDA to approximately US$12 - US$14 million.

This strategic acquisition will provide Tuscany with critical mass in one of the fastest growing markets in South America. The addition of the nine rigs will increase Tuscany's rig count in Brazil to 11, or approximately 20% of the active rig fleet in Brazil. The acquisition will provide synergies in Tuscany's operations, administration, marketing and future growth in Brazil.

The Subscription Receipt offering is expected to close on or about April 19, 2011 and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the TSX and applicable securities regulatory authorities, said Tuscany.

Tuscany, a corporation headquartered in Calgary, Alberta, is engaged in the business of providing contract drilling and work-over services along with equipment rentals to the oil and gas industry. Tuscany is currently focused on providing services to oil and natural gas operators in South America and has operating centers in Colombia, Ecuador, Brazil and Peru.

In conjunction with the acquisition, Tuscany announced that it has entered into an agreement with a syndicate of underwriters led by Wellington West Capital Markets Inc., pursuant to which the Underwriters have agreed to purchase, on a bought deal basis 65,360,000 subscription receipts at a price of $1.53 per Subscription Receipt, for aggregate gross proceeds of approximately $100 million.

In addition, the Underwriters have been granted an over-allotment option to purchase up to 9,804,000 additional Subscription Receipts at a price of $1.53 per Subscription Receipt.

31st March 2011