Enterra Energy Trust

Enterra Energy Trust

April 04, 2007 07:58 ET

Enterra Energy Trust Announces Bought Deal Financing

CALGARY, ALBERTA--(CCNMatthews - April 4, 2007) -


Enterra Energy Trust ("Enterra" or the "Trust")(TSX:ENT.UN)(NYSE:ENT) is pleased to announce that it has entered into an agreement to issue, to a syndicate of Canadian underwriters, on a bought deal basis and subject to regulatory approval, a combination of convertible debentures and trust units. The underwriting syndicate is led by Scotia Capital Inc. and includes CIBC World Markets Inc., HSBC Securities (Canada) Inc. and Orion Securities Inc. Proceeds of the financing will be used to finance the acquisition of common shares of a private company active in oil and gas exploration and development in western Saskatchewan and for general corporate purposes of the Trust. Closing of the offering, which is subject to customary regulatory approvals, is expected to occur before April 30, 2007.


Enterra will issue convertible unsecured subordinated debentures (the "Debentures") for gross proceeds of Cdn$40,000,000. The Debentures will be convertible into units of the Trust at the option of the holder at a conversion price of Cdn$6.80 per unit. The Debentures will bear interest at a rate of 8.25% per annum, payable semi-annually in arrears on December 31 and June 30 of each year commencing on December 31, 2007. The Debentures will mature on June 30, 2012.


Enterra will also issue 4,300,000 trust units at a price of Cdn$5.90 per unit for gross proceeds of Cdn$25,370,000. Enterra has granted the underwriters an option, exercisable in whole or in part until 30 days following closing, to purchase up to 645,000 additional trust units at the same offering price, to cover over-allotments and for market stabilization purposes. Should the underwriters' over-allotment option be fully exercised, the total gross proceeds of the financing will be Cdn$29,175,500.

The trust units and the Debentures will be eligible for sale in all provinces of Canada pursuant to a short form prospectus. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any state in the United States in which such offer, solicitation or sale would be unlawful. The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933, as amended and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The Debentures are not eligible for sale in the United States or internationally.

About Enterra Energy Trust

Enterra Energy Trust is a conventional oil and gas trust based in Calgary, Alberta. The Trust acquires, operates and exploits petroleum and natural gas assets principally in Alberta and British Columbia, Canada, and in Oklahoma, U.S.A.

Forward-Looking Statements

This news release contains certain forward-looking information and statements within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends", "designed" and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the foregoing, this news release contains forward-looking information and statements pertaining to the following: the proposed acquisition of Acquire Co by Enterra and the future benefits of such acquisition to unitholders; the amount of cash distributions to unitholders; the volumes and estimated value of the Trust's future oil and gas resources and reserves; future production from and prospects in the Acquire Co asset base; future oil and natural gas prices and the Trust's commodity risk management programs; future liquidity and financial capacity (including debt to cash flow ratio); future results from operations, cost estimates; future development, exploration, acquisition and development activities and related expenditures; and the completion of an equity offering by Enterra.

The forward-looking information and statements contained in this news release reflect several material factors and expectations and assumptions of the Trust including, without limitation: that the Trust will continue to conduct its operations in a manner consistent with past operations; the general continuance of current industry conditions; the continuance of existing (and in certain circumstances, proposed) tax and royalty regimes; the accuracy of the estimates of the Trust's resource volumes; the ability to acquire sufficient financing on favorable terms and certain commodity price and other cost assumptions. The Trust believes the material factors, expectations and assumptions reflected in the forward-looking information and statements are reasonable but no assurance can be given that these factors, expectations and assumptions will prove to be correct.

Any forward-looking information and statements included in this news release are not guarantees of future performance and should not be unduly relied upon. Such information and statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information or statements including, without limitation: changes in commodity prices; unanticipated operating results or production declines; incorrect estimates of resources and reserves and upside potential on assets of Acquire Co; changes in tax or environmental laws or royalty rates; increased debt levels or debt service requirements; inaccurate estimation of the Trust's oil and gas reserves volumes; limited, unfavorable or limited access to capital markets; increased costs; the impact of competitors; and certain other risks detailed from time to time in the Trust's pubic disclosure documents (including, without limitation, those risks identified in this news release and in the Trust's annual information form).

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