Terra Energy Closes on Sale of Remaining Montney Assets
CALGARY, ALBERTA -- (Marketwired) -- 07/09/13 -- Terra Energy Corp.
("Terra" or the "Company") (TSX:TT) is pleased to announce that the
Company has closed on the sale of the balance of its Montney assets
in northeast British Columbia to Crew Energy Inc. ("Crew") for gross
cash proceeds of $36 million.
This is the final stage of a three part transaction with Crew
involving the sale by the Company of its Montney assets in northeast
British Columbia for combined gross proceeds of $78 million. The
Company initially closed on the sale of Montney assets to Crew in
December 2012, for gross proceeds of $22 million, which included
Montney assets in Monias and Groundbirch. On February 28th, 2013 the
Company completed the second stage of the transaction involving
Montney assets located in Stoddart, Eagle and Attachie to Crew for
$20 million gross proceeds. This third and final stage of the
transaction involved Montney assets in Altares, Hudson and Mica but
did not include any production.
Proceeds from this final stage, less standard industry adjustments
and commissions, will be used to pay down debt and strengthen the
Company's balance sheet. It is estimated that the Company's total net
debt following closing is approximately $20 million. Terra's average
daily production for the first quarter of 2013 was 4,469 boe/d.
Terra is a junior oil and gas corporation engaged in the exploration
for, and development and production of, natural gas and oil in
Western Canada. Terra's common shares trade on the Toronto Stock
Exchange under the symbol 'TT'.
All amounts in Canadian dollars unless otherwise specified.
A boe conversion ratio of six thousand cubic feet per barrel
(6mcf/bbl) of natural gas to barrels of oil equivalence is based upon
an energy equivalency conversion method primarily applicable at the
burner tip and does not represent a value equivalency for the
individual products at the wellhead. Such disclosure of boe's may be
misleading, particularly if used in isolation. Given that the value
ratio based on the current price of crude oil as compared to natural
gas is significantly different from the energy equivalency of 6:1;
utilizing a conversion of a 6:1 basis may be misleading as an
indication of value.
This media release may contain certain statements which constitute
forward-looking statements or information ("forward-looking
statements") including: proceeds from the sale will be utilized by
the Company to pay down debt and strengthen the balance sheet and
total net debt of the Company following closing is estimated to be
approximately $20 million. Although Terra believes that the
expectations reflected in our forward-looking statements are
reasonable, our forward-looking statements have been based on
expectations, factors and assumptions concerning future events which
may prove to be inaccurate. Those expectations, factors and
assumptions are based upon currently available information available
to the Company. Such statements are subject to known and unknown
risks, uncertainties and other factors that could influence actual
results or events and cause actual results or events to differ
materially from those stated, anticipated or implied in the
forward-looking statements. As such, readers are cautioned not to
place undue reliance on the forward-looking statements, as no
assurance can be provided as to future results, levels of activity or
achievements. The risks, uncertainties, material assumptions and
other factors that could affect actual results are discussed in our
Annual Information Form and other documents available at
www.sedar.com. Furthermore, the forward-looking statements contained
in this document are made as of the date of this document and, except
as required by applicable law, Terra does not undertake any
obligation to publicly update or to revise any of the included
forward-looking statements, whether as a result of new information,
future events or otherwise. The forward-looking statements contained
in this document are expressly qualified by this cautionary
Terra Energy Corp.
Vice President of Finance & Chief Financial Officer
Terra Energy Corp.
Manager, Corporate Affairs
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