C1 Energy Ltd.
TSX : CTT

C1 Energy Ltd.

March 30, 2007 18:39 ET

C1 Energy Announces Loan Extension Agreement

CALGARY, ALBERTA--(CCNMatthews - March 30, 2007) - C1 Energy Ltd. (TSX:CTT) ("C1") announces that it has reached an agreement with its principal lender for an extension of its credit facilities. Our lender has agreed, subject to certain conditions, to establish our credit facility at $13 million on April 1, 2007 which will be reduced by proceeds of a non-producing asset disposition on or before April 15, 2007, and to be repaid in full by May 31, 2007. This will allow C1 to conduct its strategic alternatives process to maximize shareholder value as previously announced on January 25, 2007. Such alternatives may include the sale, merger or takeover of the company, or the reorganization or restructuring of some or all of the Corporation's properties, or any other alternatives that are considered to be in the best interest of C1 shareholders. There is be no assurance that any transaction will be completed or the timing thereof.

Based on C1's updated independent engineering evaluation as at December 31, 2006, our principal lender has established the maximum lending value under our existing revolving facility to be $7.2 million, reducing on a monthly basis thereafter by not less than $325,000. The parties agree that C1 will be unable to reduce its bank indebtedness to $7.2 million by March 31, 2007.

As consideration for our principal lender's agreement to forbear from exercising its right to demand immediate repayment of C1's indebtedness during the extension period, the rate of interest applicable to our loans will be equal to prime plus 2 1/4 % commencing on April 1, 2007. In addition, C1 will pay to its principal lender certain additional fees on or before May 31, 2007.

C1 Energy is an exploration focused junior E&P company that has assembled an extensive undeveloped land position containing 133,500 net acres of high working interest lands, with the majority located in C1's core operating areas of Gift Lake and Blueberry in the Peace River Arch.

Certain information set forth in this press release contains forward-looking statements. All statements other than historical fact contained herein are forward-looking statements, including, without limitation, statements regarding the future financial position, business strategy, production rates and plans and objectives of or involving C1 Energy Ltd. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond C1's control, including the impact of general economic conditions, industry conditions, governmental regulation, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and ability to access sufficient capital from internal and external sources. Readers 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 statements. C1's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that C1 will derive therefrom. C1 disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Disclosure provided herein in respect of barrels of oil equivalent ("boe") may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf:1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Contact Information

  • C1 Energy Ltd.
    Donald S. Wood
    President & CEO
    (403) 232-1115 ext 105
    or
    C1 Energy Ltd.
    Gary L. Lobb
    VP Finance & CFO
    (403) 232-1115 ext 106
    or
    C1 Energy Ltd.
    500, 521-3rd Avenue S.W.
    Calgary, AB T2P 3T3 Canada
    (403) 232-1115
    (403) 232-1130 (FAX)
    Website: www.c1energy.ca