2012-12-21 00:12:01 -
CALGARY, ALBERTA -- (Marketwire) -- 12/20/12 -- Twoco Petroleums Ltd. ("Twoco" or the "Company") (TSX VENTURE:TWO) announces that it has entered into an agreement to amend its credit facility with its lender with provisions that include:
-- The existing operating line of credit will be increased a further
-- The Company's credit facilities will be extended to April 30, 2013; and
-- Interest payments have been deferred to the earlier of April 30, 2013 or
the closing of a sale of the assets of Twoco or a merger or corporate
sale pursuant to the Sale Process (as defined below).
Twoco is in the process of reactivating six natural gas wells with a targeted production date of on or before January 31, 2013. The Company anticipates that the reactivation of these wells will add approximately 150 boe per day of natural gas production. The Company is currently producing approximately 300 boe per day (includes 105 barrels per day of oil and natural gas liquids) with total estimated current productive capacity of 845 boe per day. Twoco has a material, high working interest land position in its core area in Eastern Alberta, a significant number of prospective drilling locations, a strategic proprietary seismic database and a tax pool position in excess of $45 million as at September 30, 2012.
Twoco previously announced that it has been working on certain strategic alternatives including, but not limited to, recapitalizing the Company through financing arrangements, the sale of some or all of the assets of the Company or merging with other companies.
The Company has engaged Macquarie Capital Markets Canada Ltd. as its financial advisor to conduct a full analysis and investigation of Twoco's strategic alternatives which include a possible sale, transfer or other disposition, directly or indirectly, of all or part of the equity securities, assets or business of Twoco (the "Sale Process"). Twoco does not intend to disclose developments with respect to the Sale Process until the board of directors has approved a definitive transaction or strategic option, unless otherwise determined or required by law. There are no guarantees that the process will result in a transaction or, if a transaction is entered into, as to its terms or timing.
Twoco is an oil and gas company engaged in the exploration for, and the acquisition, development and production of, oil and natural gas reserves primarily in the Province of Alberta. Twoco has 73,905,789 common shares issued and outstanding as at today's date.
In this news release the calculation of barrels of oil equivalent (boe) is calculated at a conversion rate of six thousand cubic feet (Mcf) of natural gas for one barrel (Bbl) of oil based on an energy equivalency conversion method. Boes may be misleading particularly if used in isolation. A boe conversion ratio of 6 Mcf: 1Bbl is based on an energy equivalency conversion method primarily applicable to the burner tip and does not represent a value equivalency at the wellhead. 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 on a 6:1 basis may be misleading as an indication of value.
Certain information set forth in this news release contains forward-looking statements or information ("forward-looking statements"), including statements regarding the Company's credit facility, the Company's reactivation of six natural gas wells, the anticipated production from the reactivated natural gas wells, the total estimated productive capacity of the Company and the pursuit by the Company of strategic alternatives. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond Twoco's control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, operational risks in exploration and development, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and the ability to access sufficient capital from internal and external sources. Although Twoco believes that the expectations in our forward-looking statements are reasonable, our forward-looking statements have been based on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and assumptions are based upon currently available information. 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, Twoco 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 statement.
This news release shall not constitute an offer to sell or the solicitation of any offer to buy securities in any jurisdiction.
Neither 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.
Twoco Petroleums Ltd.
Wayne A. Malinowski
President and Chief Executive Officer
(403) 237-6048 (FAX)