CALGARY, ALBERTA–(Marketwired – June 4, 2013) – Terra Energy Corp. (TSX:TT) (“Terra” or the “Company”) is pleased to announce that Crew Energy Inc. (“Crew”) has exercised the option to purchase the balance of Terra’s Montney assets in northeast British Columbia for a purchase price of $36 million.
On February 28, 2013, the Company granted Crew an option to acquire the balance of its unconventional Montney assets located in northeast British Columbia for a purchase price of $36 million, subject to typical industry adjustments, by way of a combination of cash or common shares of Crew, with a minimum cash component of $10 million. The option contained restrictions on assignment and had to be exercised by Crew on or before June 3, 2013, with a closing to occur on or before July 9, 2013.
On June 3, 2013, Crew elected to exercise its option to purchase the balance of Terra’s Montney assets. The companies have also entered into a fully executed purchase and sale agreement in respect of this sale. Crew will have until 10 days prior to closing in order to notify Terra of the combination of cash and shares comprising the purchase price, providing that the purchase price includes a minimum cash component of $10 million.
Terra intends to utilize the net proceeds from this sale to further reduce its indebtedness. Terra’s production and cash flow will remain unchanged as a result of this sale as the assets included in this transaction have no current production attributed to them.
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.
This media release may contain certain statements which constitute forward-looking statements or information (“forward-looking statements”) including: the closing date of the asset sale and net proceeds from the sale will be utilized by the Company to reduce Terra’s indebtedness. 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 statement.
Vice President of Finance & Chief Financial Officer
Terra Energy Corp.
Manager, Corporate Affairs