OILEXCO INCORPORATED
AIM : OIL
TSX : OIL

OILEXCO INCORPORATED

June 08, 2007 12:04 ET

Oilexco Engages Royal Bank of Scotland to Increase Credit Facilities for Offshore Developments

CALGARY, ALBERTA--(Marketwire - June 8, 2007) - Oilexco Incorporated ("Oilexco") (TSX:OIL) (AIM:OIL) announces that its wholly owned subsidiary, Oilexco North Sea Limited, has entered into an engagement letter with the Royal Bank of Scotland plc to increase Oilexco's existing credit facilities. Oilexco currently has access to a US $275 million Borrowing Base Facility which has provided funding for the development of Oilexco's 100% owned Brenda and Nicol Fields. Subject to a number of conditions, the Royal Bank of Scotland has agreed to propose to the banking syndicate that this Borrowing Base Facility increase to US $500 million to provide additional capital for other developments, currently anticipated to include the Ptarmigan Field and the Shelley Field.

The engagement letter also contemplates an increase of the Pre-Development Facility (a bilateral facility with RBS) which is used to finance costs not tied to a specific field or when long lead items are required to be ordered before the time when the expenditures can be made under the Borrowing Base Facility.

"Our recent exploration successes will require us to expend a great deal of capital in order to get new fields on production as soon as we can," said Art Millholland, President of Oilexco. "The continuing support of the Royal Bank of Scotland to allow us to fund development expenditures with debt, while using our equity and cash from operations for exploration and other purposes, permits us to use the leverage of our strong balance sheet in the growth of the Company."

About the Company

Oilexco is an oil and gas exploration and production company active in the United Kingdom. Oilexco's producing properties and exploration activities are located in the UK Central North Sea, specifically in the Outer Moray Firth and Central Graben areas. The Company currently has one wholly owned subsidiary, Oilexco North Sea Limited, a company registered under the laws of England and Wales. Oilexco trades on the Toronto Stock Exchange (TSX) in Canada and the London Stock Exchange's Alternative Investment Market (AIM) under the symbol "OIL".

Forward Looking Statements

This disclosure contains certain forward-looking statements that involve substantial known and unknown risks and uncertainties, certain of which are beyond Oilexco's control, including: the impact of general economic conditions in the areas in which Oilexco operates, civil unrest, industry conditions, changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in commodity prices, foreign exchange or interest rates, stock market volatility and obtaining required approvals of regulatory authorities. In addition there are risks and uncertainties associated with oil and gas operations, therefore Oilexco's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements will transpire or occur, or if any of them do so, what benefits, including the amounts of proceeds, which Oilexco will derive therefrom. All statements included in this press release that address activities, events or developments that Oilexco expects, believes or anticipates will or may occur in the future are forward-looking statements. These statements include future production rates, completion and production timetables and costs to complete wells, and production facilities. These statements are based on assumptions made by Oilexco based on its experience, perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances.

Oilexco is listed on the Alternative Investment Market of the London Stock Exchange plc and the Toronto Stock Exchange, in each case trading under the symbol OIL.

Contact Information

  • Oilexco Incorporated
    Arthur S. Millholland
    President
    (403) 262-5441
    or
    Oilexco Incorporated
    Brian L. Ward
    Chief Financial Officer
    (403) 262-5441
    or
    Oilexco Incorporated
    Gerry L. Roe
    Chief Operating Officer
    (403) 262-5441
    or
    Oilexco Incorporated
    Rob Elgie
    Manager Investor Relations
    (403) 262-5411
    Website: www.oilexco.com
    or
    Pelham PR
    James Henderson
    Managing Director
    44 (20) 7743 6673
    or
    Pelham PR
    Alisdair Haythornthwaite
    Associate Director
    44 (20) 7743 6676
    or
    Canaccord Adams Limited
    Clayton Bush
    Vice President
    44 (20) 7050 6500
    or
    Merrill Lynch International
    Andrew Osborne
    Managing Director
    44 (20) 7996 1000