Provident Energy Trust

Provident Energy Trust

December 23, 2009 19:45 ET

Provident Announces the Sale of West Central Alberta Oil and Natural Gas Assets for $190 Million

CALGARY, ALBERTA--(Marketwire - Dec. 23, 2009) -

All values are in Canadian dollars and conversion of naturalgas volumes to barrels of oil equivalent (boe) are at 6:1 unless otherwiseindicated.

Provident Energy Trust (Provident, the Trust) (TSX:PVE.UN)(NYSE:PVX) today announced it has reached an agreement with a private company,Storm Ventures International Inc., to sell Provident's oil and natural gasassets in West Central Alberta for cash consideration of $190 million, prior tonormal closing adjustments. The divestiture of the West Central Alberta packageis part of an asset rationalization initiative which also included the recentsale of the Trust's Lloydminster and Southern Saskatchewan properties.

This divestiture program has repositioned Provident'sportfolio for growth by monetizing non-core properties and focusing financialand technical resources on those assets with significant growth potential.Provident's previously announced consolidated 2010 capital budget of $142million remains unchanged with approximately $55 million directed towards ourUpstream assets in the areas of Peace River Arch/Dixonville, Northwest Albertaand Southern Alberta.

"This transaction is another key step towardsrepositioning Provident as a sustainable growth vehicle and further enhancesour financial flexibility moving forward," said Tom Buchanan, President andChief Executive Officer. "Management and the Board of Directors wish tosincerely thank the Provident staff associated with these assets for their dedicationand service to Provident."

The West Central Alberta operating area produces approximately5,000 barrels of oil equivalent per day (boed), comprised of approximately 70percent natural gas and 30 percent liquids. Total proved reserves were 10.5million barrels of oil equivalent (mmboe) at September 30, 2009, while provedplus probable (P+P) reserves were approximately 14.6 mmboe. The sale reflectstransaction metrics of $38,000 per flowing boed, $18.15 per boe of provedreserves and $13.02 per boe of P+P reserves. This transaction is expected toclose in the first quarter of 2010, with an October 1, 2009 effective date.Proceeds from this asset disposition will be used to reduce outstanding debtunder Provident's revolving term credit facility.

Provident Energy Trust is a Calgary-based,open-ended energy income trust that owns and manages a natural gas liquids(NGL) midstream services and marketing business and an oil and gas productionbusiness. Provident's oil and gas portfolio is located in some of the moststable and predictable producing regions in Western Canada. Provident'sMidstream facilities are also strategically located in Western Canada and inthe premium NGL markets in Eastern Canada and the U.S. Provident providesmonthly cash distributions to its unitholders and trades on the Toronto StockExchange and the New York Stock Exchange under the symbols PVE.UN and PVX,respectively.

This document contains certainforward-looking statements concerning Provident, as well as other expectations,plans, goals, objectives, information or statements about future events,conditions, results of operations or performance that may constitute"forward-looking statements" or "forward-looking information" under applicablesecurities legislation. Such statements or information involve substantialknown and unknown risks and uncertainties, certain of which are beyondProvident's control, including the impact of general economic conditions inCanada and the United States, industry conditions, changes in laws andregulations including the adoption of new environmental laws and regulationsand changes in how they are interpreted and enforced, increased competition,the lack of availability of qualified personnel or management, pipeline designand construction, fluctuations in commodity prices, foreign exchange orinterest rates, stock market volatility and obtaining required approvals ofregulatory authorities.

Such forward-looking statements orinformation are based on a number of assumptions which may prove to beincorrect. In addition to other assumptions identified in this news release,assumptions have been made regarding, among other things, commodity prices,operating conditions, capital and other expenditures, and project developmentactivities. 

Although Provident believes that theexpectations reflected in such forward-looking statements or information arereasonable, undue reliance should not be placed on forward-looking statementsbecause Provident can give no assurance that such expectations will prove to becorrect. Forward-looking statements or information are based on currentexpectations, estimates and projections that involve a number of risks anduncertainties which could cause actual results to differ materially from thoseanticipated by Provident and described in the forward-looking statements orinformation.

The forward-looking statements or information containedin this news release are made as of the date hereof and Provident undertakes noobligation to update publicly or revise any forward-looking statements orinformation, whether as a result of new information, future events or otherwiseunless so required by applicable securities laws. The forward-lookingstatements or information contained in this news release are expressly qualifiedby this cautionary statement.

Contact Information

  • Provident Energy Trust
    Investor and Media Contact:
    Dallas McConnell
    Director, Investor Relations
    (403) 231-6710
    Corporate Head Office:
    2100, 250 - 2nd Street SW
    Calgary, Alberta T2P 0C1
    (403) 296-2233 or Toll Free: 1-800-587-6299
    Fax: (403) 262-5973