Eurogas Corporation
TSX VENTURE : EUG

Eurogas Corporation

September 15, 2005 18:30 ET

Eurogas Corporation: News Release

CALGARY, ALBERTA--(CCNMatthews - Sept. 15, 2005) - Eurogas Corporation (TSX VENTURE:EUG) ("Eurogas") is pleased to announce that it has finalized the terms of a rights offering to holders of its common shares. Eurogas will be issuing to holders of its outstanding common shares of record at the close of business on September 28, 2005, transferable rights certificates to subscribe for common shares before 4:30 p.m. (Calgary time) on October 21, 2005, on the terms set out in a rights offering prospectus to be mailed by Eurogas to its shareholders. The rights offering prospectus will also be available on SEDAR at www.sedar.com. One right will be issued for each common share outstanding and four rights will entitle the holder to purchase one additional common share of Eurogas at $1.32 per share. Shareholders who exercise all of their rights will also be entitled to acquire additional common shares, if available, pursuant to an additional subscription privilege as described in the rights offering prospectus. The rights have been conditionally approved for listing on the TSX Venture Exchange until 10:00 a.m. (Calgary time) on October 21, 2005.

The rights offering is subject to the receipt of all applicable regulatory approvals.

Dundee Corporation, the major shareholder of the Corporation, has indicated that it will subscribe for all common shares to which it is entitled under the basic subscription right, being 12,128,036 common shares and all common shares to which it is entitled under the additional subscription privilege.

If all rights are exercised, 24,348,286 common shares will be issued, for total gross proceeds of approximately $32,139,738. The offering is not subject to any minimum subscription level. Net proceeds raised will be released to Eurogas for its use. Eurogas intends to use the proceeds for its exploration and development programs and for working capital purposes.

The offering will be made in all jurisdictions in which the offer can legally be made, including in all the provinces and territories of Canada. Shareholders will be provided with a rights offering prospectus detailing the offering upon receipt of all necessary regulatory approvals.

Eurogas is a Canadian oil and gas exploration and development company engaged in development of a major underground storage facility offshore the east coast of Spain, and the exploration and development of oil and gas in Tunisia's Gulf of Gabes.

Jaffar Khan

President & CEO

This press release contains certain forward-looking statements that reflect the current views and/or expectations of Eurogas with respect to its performance, business and future events. Such statements are subject to a number of risks, uncertainties and assumptions which may cause actual results to be materially different from those expressed or implied. Eurogas assumes no future obligation to update these forward-looking statements.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction. The rights and the Common Shares issuable on exercise of the rights will not be and have not been 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 the registration requirements.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Eurogas Corporation
    Jaffar Khan
    President & CEO
    (403) 264-4985
    or
    Eurogas Corporation
    Andrew Constantinidis
    Vice President & CFO
    (403) 264-4985
    (403) 262-8299 (FAX)
    Email: eurogas@eurogascorp.com
    Website: www.eurogascorp.com
    or
    Eurogas Corporation
    520, 333 - 5th Avenue SW
    Calgary, Alberta, Canada
    T2P 3B6