Freehold Royalties Ltd. Closes Acquisition of Royalty Production and Mineral Title Lands

Freehold Royalties Ltd. Closes Acquisition of Royalty Production and Mineral 
Title Lands 
FOR: Freehold Royalties Ltd. 
MAY 5, 2014 
Freehold Royalties Ltd. Closes Acquisition of Royalty Production and Mineral
Title Lands 
CALGARY, ALBERTA--(Marketwired - May 5, 2014) - Freehold Royalties Ltd.
(Freehold) (TSX:FRU) announces that it has closed the previously announced
acquisition involving royalty interests in southeast Saskatchewan and Manitoba
(Vendor assets). Total consideration associated with the transaction was $111
million (before closing adjustments) with Freehold funding the deal through its
existing bank credit line.  
In addition, as part of the transaction, Canpar Holdings Ltd., a wholly-owned
subsidiary of CN Pension Trust Funds, purchased certain undeveloped mineral
title lands (Vendor assets) for $30 million (before closing adjustments).  
The effective date of the acquisition is January 1, 2014. With the closing of
the acquisition, Freehold has significantly strengthened its operating base and
future opportunities while maintaining financial strength and sustainability of
its dividend. 
Acquisition Highlights: 
--  2013 average production of 470 barrels of oil equivalent (boe) per day 
(99% oil weighted), from over 400 producing wells. Revenue is derived 
from a combination of Lessor Royalties and Non-Convertible Overriding 
Royalties, offering Freehold enhanced netbacks. 
--  2013 net operating income of $15.0 million. 
--  Increased land exposure adding 71,700 acres of Mineral Title Lands. 
--  Proved plus probable reserves of approximately 1.5 million boe, based on 
an independent engineering report prepared by Trimble Engineering 
Associates Ltd. as of December 31, 2013. 
--  37 gross new wells drilled within the acquired acreage through 2013. 
--  The acquisition also provides Freehold exposure to:  
--  A stable oil weighted revenue stream.  
--  The ability to grow royalty volumes through future year drilling 
--  Increased percentage of mineral title ownership relative to 
Freehold's existing acreage.
--  Freehold estimates 2014 year-end net debt of approximately $140-$145 
million (which leaves $65-$70 million in available capacity on our 
existing credit line), while implying approximately 1.0 times debt to 
funds flow (based on guidance provided in our fourth quarter news 
--  We have increased our production guidance for 2014 by 6% to 9,100 boe 
per day; all other operating assumptions (provided in our fourth quarter 
news release) remain unchanged. As we have in the past, we expect to 
update shareholders on 2014 guidance for other key operating assumptions 
when we release our first quarter results on May 14, 2014. 
Freehold is a Calgary based, dividend paying, oil-weighted oil and gas company
focused on providing a sustainable monthly dividend to its shareholders. We
effectively manage our assets to consistently deliver attractive returns over
the long-term. For further information about Freehold please visit our website
Cautionary Statement Regarding Forward-Looking Information - This news release
offers our assessment of Freehold's future plans and operations as at May
2, 2014 and contains forward-looking information including, Freehold's
expectations for reserves, production, year-end debt and future prospects on
the acquired lands. This forward-looking information is provided to allow
readers to better understand our business and prospects and may not be suitable
for other purposes. By its nature, forward-looking information is subject to
numerous risks and uncertainties, some of which are beyond our control,
including the impact of general economic conditions, industry conditions,
volatility of commodity prices, currency fluctuations, imprecision of reserve
estimates, environmental risks, taxation, royalties, regulation, competition
from other industry participants, the lack of availability of qualified
personnel or management, stock market volatility, and our ability to access
sufficient capital from internal and external sources. Risks are described in
more detail in Freehold's annual information form for the year ended
December 31, 2013 which is available under Freehold's profile on SEDAR at 
With respect to forward looking information contained in this news release, we
have made assumptions regarding, among other things, future oil and natural gas
prices; future capital expenditure levels; future production levels; future
exchange rates; the costs of developing and producing our assets; our ability
and the ability of our lessees to obtain equipment in a timely manner to carry
out development activities; our expectation for industry drilling levels; and
our ability to obtain financing on acceptable terms. 
You are cautioned that the assumptions used in the preparation of such
information, although considered reasonable at the time of preparation, may
prove to be imprecise and, as such, undue reliance should not be placed on
forward-looking information. We can give no assurance that any of the events
anticipated will transpire or occur, or if any of them do, what benefits we
will derive from them. The forward-looking information contained herein is
expressly qualified by this cautionary statement. Except as required by law,
Freehold does not assume any obligation to publicly update or revise any
forward-looking information to reflect new events or circumstances. 
Conversion of Natural Gas To Barrels of Oil Equivalent (BOE) 
To provide a single unit of production for analytical purposes, natural gas
production and reserves volumes are converted mathematically to equivalent
barrels of oil (boe). We use the industry-accepted standard conversion of six
thousand cubic feet of natural gas to one barrel of oil (6 Mcf = 1 bbl). The
6:1 boe ratio is based on an energy equivalency conversion method primarily
applicable at the burner tip. It does not represent a value equivalency at the
wellhead and is not based on either energy content or current prices. While the
boe ratio is useful for comparative measures and observing trends, it does not
accurately reflect individual product values and might be misleading,
particularly if used in isolation. As well, given that the value ratio, based
on the current price of crude oil to natural gas, is significantly different
from the 6:1 energy equivalency ratio, using a 6:1 conversion ratio may be
misleading as an indication of value. 
Freehold Royalties Ltd.
Matt Donohue
Manager, Investor Relations
403.221.0833 or 1.888.257.1873
INDUSTRY:  Energy and Utilities - Oil and Gas  
-0- May/05/2014 21:05 GMT
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