Nations Energy Company Ltd.

Tartan Energy Inc.

Tartan Energy Inc.

August 29, 2005 00:44 ET

Nations Energy's Subsidiary Acquires Additional Shares Under Offer For Tartan Energy; Offer Extended Until September 9, 2005

CALGARY, ALBERTA--(CCNMatthews - Aug. 29, 2005) - Nations Energy Company Ltd. announces that its subsidiary, 1153298 Alberta Ltd. ("Offeror"), has acquired an additional 7.5 million common shares of Tartan Energy Inc. (TSX Venture: TEW) since August 12, 2005 under the Offeror's offer to acquire all of the common shares of Tartan not already owned by Nations and its affiliates. To date, an aggregate of approximately 70 million Tartan shares have been acquired under the offer. As a result, Nations and its affiliates now own approximately 90.1 million common shares of Tartan, representing approximately 79% of the 114,727,870 Tartan shares outstanding at the commencement of the offer and approximately 73% of the total number of Tartan shares that would be outstanding upon the exercise of all outstanding stock options.

The Offeror has extended the offer to 4:30 p.m. (Calgary time) on Friday, September 9, 2005 for the purpose of maximizing the number of shares acquired pursuant to the offer and providing those shareholders who during the summer months have been unavailable to respond to the offer and have not yet tendered to the offer the opportunity to do so.

To date, with the exception of agreeing to appoint Daniel A. Linnett, an officer of Nations, to the board of directors of Tartan, the existing directors of Tartan have refused a request by Nations to cooperate in changing the composition of the board of directors of Tartan. Consequently, on August 12, 2005, Nations requisitioned the directors of Tartan to call a meeting of shareholders for the purpose of electing Daniel A. Linnett, Ford G. Nicholson and Gunther H. Rothaupt as the sole directors of Tartan. All these individuals are current or former directors of Tartan.

In light of the recommendations made and actions taken by the board of directors of Tartan to date, the Offeror is not prepared to propose a second stage transaction until the board has been changed. For a second stage transaction to have the benefit of certain provisions that would facilitate the transaction under Ontario Securities Commission Rule 61-501 (in particular, the ability to include the shares tendered under the offer in any "majority of the minority" requirement), the second stage transaction must be completed within 120 days after the expiry of the offer. Accordingly, until there has been a change in the composition of the board of directors of Tartan, the Offeror will consider extending the offer to preserve its ability to benefit from these provisions. Although there is no assurance that a second stage transaction to acquire the remaining shares of Tartan will be completed, the delay in changing the directors will delay the timing for any second stage transaction and may result in such transaction being unable to be completed.

Nations is a privately owned Alberta oil and gas company engaged in the exploration for, and the acquisition, development and production of, oil and natural gas reserves internationally. Nations' oil production exceeds 45,000 barrels per day.

Contact Information

  • Nations Energy Company Ltd.
    David G. Wilson, Executive Vice President of
    Nations Energy Company Ltd. and 1153298 Alberta Ltd.
    403-206-1520 (FAX)