Terrex Energy Inc. - Announces Vendor Approval of Property Purchase
09 February 2011 - 4:50AM
PR Newswire (Canada)
CALGARY, Feb. 8 /CNW/ -- CALGARY, Feb. 8 /CNW/ - Terrex Energy Inc.
("Terrex" or the "Company") (TSX-V - TER) announces that it has
been advised that its offer to purchase certain producing oil and
natural gas properties in west central Alberta, for a total cash
consideration of $16.1 million, has been accepted by the vendor, an
independent arm's length party, subject to entering into a
definitive purchase and sale agreement. Terrex management believes
that the properties are good candidates for Improved and Enhanced
Oil Recovery programs, consistent with the Company's business plan.
Such programs can significantly increase production and recoverable
reserves and the Company intends to commence the planning,
evaluation and development of such programs immediately following
closing. The property consists of a 100% working interest in 4,320
acres of land, including related production infrastructure, in west
central Alberta. The property to be acquired is currently producing
approximately 250 boe/d, comprised of 210 barrels of oil and
natural gas liquids; and 300 mcf/d of natural gas. The offer is
subject to normal conditions, including completing due diligence
and the finalization of financing arrangements and is subject to
approval by the TSX Venture Exchange (TSXV). In accordance
with the terms of the offer, the acquisition will be effective as
of January 1, 2011 and is expected to close on March 11, 2011. The
Company and the vendor are proceeding with the preparation of a
definitive purchase and sale agreement. Terrex intends to finance
the acquisition initially through a combination of working capital
and the assumption of debt. The acquisition would constitute a
fundamental acquisition under the policies of the TSXV. In
accordance with the policies of the TSXV, the shares of the Company
will be halted pending receipt and review by the TSXV of acceptable
documentation regarding the acquisition. Terrex Energy Inc. is a
Calgary-based junior oil company that specializes in the
application of proven Enhanced Oil Recovery (EOR) methods to
improve oil production from mature pools. Terrex targets
underexploited and undercapitalized light-to-medium oil reservoirs
in Western Canada. Terrex shares are listed on the TSX Venture
Exchange under the symbol 'TER' Neither the TSV Venture Exchange
nor its Regulation Service Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release. Barrels of Oil Equivalent
Production volumes are commonly expressed on a barrel of oil
equivalent ("Boe') basis whereby natural gas volumes are converted
at the ratio of six thousand cubic feet of natural gas to one
barrel of oil based on an energy equivalency at the burner tip and
does not represent a value equivalency at the well head. Used in
isolation, barrels of oil equivalent may be misleading.
Forward-Looking Statements This news release contains certain
forward-looking statements and forward-looking information
(collectively referred to herein as "forward-looking statements")
within the meaning of Canadian securities laws. All statements
other than statements of historical fact are forward-looking
statements. In particular, this press release contains
forward-looking statements pertaining to expectations of management
regarding the proposed acquisition, including the completion of a
definitive purchase and sale agreement, the terms of the
acquisition; the closing date of the acquisition; financing
activities to be conducted by Terrex to finance the acquisition,
including the assumption of debt; and the use of proceeds
thereof; the characteristics of the property, including the
expectation that the property will be a good candidate for Improved
and Enhanced Oil Recovery programs; the expected timing of the
planning, evaluation and development of the programs, and the
success of such programs. Undue reliance should not be placed
on forward-looking statements, which are inherently uncertain, are
based on estimates and assumptions, and are subject to known and
unknown risks and uncertainties (both general and specific) that
contribute to the possibility that the future events or
circumstances contemplated by the forward-looking statements will
not occur. Assumptions include, among other things: future capital
expenditure levels; the ability to successfully negotiate a
definitive purchase and sale agreement; the ability to secure
regulatory approval, the ability to obtain debt on acceptable
terms to finance the acquisition; future oil and natural gas
prices; future oil and natural gas production levels; the success
of IOR and EOR programs; the ability to obtain equipment in a
timely manner to carry out development activities; the ability to
market oil and natural gas successfully; and the impact of
increasing competition. Although Terrex believes that the
expectations reflected in the forward looking statements contained
in this press release, and the assumptions on which such
forward-looking statements are made, are reasonable, there can be
no assurance that such expectations will prove to be correct.
Readers are cautioned not to place undue reliance on
forward-looking statements included in this document, as there can
be no assurance that the plans, intentions or expectations upon
which the forward-looking statements are based will occur. By their
nature, forward-looking statements involve numerous assumptions,
known and unknown risks and uncertainties that contribute to the
possibility that the predictions, forecasts, projections and other
forward-looking statements will not occur, which may cause Terrex's
actual performance and results in future periods to differ
materially from any estimates or projections of future performance
or results expressed or implied by such forward-looking statements.
These risks and uncertainties include, among other things, the
following: that the acquisition may not close when planned or at
all or on the terms and conditions set forth herein; the failure of
Terrex to obtain the necessary regulatory approval required in
order to proceed with the acquisition; volatility in market prices
for oil and natural gas; failure to complete planned financing
activities; incorrect assessment of the value of the acquisition;
failure to realize the anticipated benefits of the acquisition;
general economic conditions in Canada; and the other factors.
Readers are cautioned that this list of risk factors should not be
construed as exhaustive. The forward-looking statements contained
in this news release are made as of the date hereof and Terrex does
not undertake any obligation to update publicly or to revise any of
the included forward-looking statements, except as required by
applicable law. The forward-looking statements contained herein are
expressly qualified by this cautionary statement. To view this news
release in HTML formatting, please use the following URL:
http://www.newswire.ca/en/releases/archive/February2011/08/c8931.html
pKim Davies, President & CEO, or Norm Knecht, VP Finance &
CFO, at (403) 264-4430, or visit Terrex's website at a
href="http://terrexenergy.ca/"terrexenergy.ca/a/p
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