Pengrowth Energy Trust

Pengrowth Energy Trust
Pengrowth Corporation

Pengrowth Corporation

December 08, 2006 09:13 ET

Pengrowth Energy Trust Announces Closing of $461 Million Equity Financing

CALGARY, ALBERTA--(CCNMatthews - Dec. 8, 2006) - Pengrowth Corporation, administrator of Pengrowth Energy Trust, (collectively, "Pengrowth") (TSX:PGF.UN)(NYSE:PGH) announces that it has closed the previously announced equity offering. Pengrowth issued 24,265,000 trust units at Cdn $19.00 per trust unit for gross proceeds of $461,035,000. This includes the full exercise by the underwriters of their option to purchase up to an additional 3,165,000 trust units.

The net proceeds from this offering will be used to finance a portion of the Cdn $1.0375 billion purchase price of the Canadian oil and natural gas producing properties and undeveloped lands to be purchased by Pengrowth through the acquisition of the shares of subsidiaries of Burlington Resources Ltd., a subsidiary of ConocoPhilips Canada, which was announced on November 29, 2006 and which is anticipated to close on or about January 18, 2007. In the interim, the net proceeds will be invested, used for general corporate or trust purposes or used to reduce outstanding indebtedness. Purchasers of Pengrowth trust units issued pursuant to the offering will be eligible for the $0.25 per unit distribution payable on January 15, 2007.

The offering was underwritten by a syndicate of underwriters led by RBC Capital Markets that included BMO Capital Markets, CIBC World Markets Inc., Scotia Capital Inc., National Bank Financial Inc., TD Securities Inc., Merrill Lynch Canada Inc., HSBC Securities (Canada) Inc., Canaccord Capital Corporation, Raymond James Ltd., Sprott Securities Inc., Dundee Securities Corporation, FirstEnergy Capital Corp., Peters & Co. Limited and Tristone Capital Inc.

Pengrowth Energy Trust is one of the larger energy royalty trusts in North America. Trust units trade on the Toronto Stock Exchange (PGF.UN) and the New York Stock Exchange (PGH). Through the purchase of trust units, unitholders participate in the ownership of a large portfolio of crude oil and natural gas producing properties, receiving the net cash flow (after expenses and other withholdings), paid monthly, as the oil and gas reserves are produced. Pengrowth's property portfolio is one of the strongest in the energy trust sector with a proved plus probable reserve life index of 10.6 years and a reserve base of 219.4 million boe at December 31, 2005 (total proved plus probable reserves on a company interest before royalties basis based on forecast pricing). Pengrowth's assets are generally characterized by low decline rates and high development potential allowing for a relatively stable production.


James S. Kinnear, Chairman, President and Chief Executive Officer


This news release shall not constitute an offer to sell or the solicitation of an offer to buy Pengrowth trust units, nor shall there be any sale of Pengrowth trust units in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.

Caution Regarding Engineering Terms:

When used herein, the term "boe" means barrels of oil equivalent on the basis of one boe being equal to one barrel of oil or NGLs or 6,000 cubic feet of natural gas (6 mcf: 1 bbl). Barrels of oil equivalent may be misleading, particularly if used in isolation. A conversion ratio of six mcf of natural gas to one boe is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. As used herein, the term mmboe is defined as millions of barrels of oil equivalent.

Caution Regarding Forward Looking Information:

This press release contains forward-looking statements within the meaning of securities laws, including the "safe harbour" provisions of the Ontario Securities Act and the United States Private Securities Litigation Reform Act of 1995. Forward-looking information is often, but not always, identified by the use of words such as "anticipate", "believe", "expect", "plan", "intend", "forecast", "target", "project", "may", "will", "should", "could", "estimate", "predict" or similar words suggesting future outcomes or language suggesting an outlook. Forward-looking statements in this press release include, but are not limited to, statements with respect to the use of the proceeds of the offering.

Forward-looking statements and information are based on current beliefs as well as assumptions made by and information currently available to Pengrowth concerning anticipated financial performance, business prospects, strategies and regulatory developments. Although management considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect.

By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks that predictions, forecasts, projections and other forward-looking statements will not be achieved. We caution readers not to place undue reliance on these statements as a number of important factors could cause the actual results to differ materially from the beliefs, plans, objectives, expectations and anticipations, estimates and intentions expressed in such forward-looking statements. These factors include, but are not limited to: incorrect assessments of value when making acquisitions; increases in debt service charges; fluctuations in foreign currency and exchange rates; inadequate insurance coverage; changes in tax laws; and Pengrowth's ability to access external sources of debt and equity capital. Further information regarding these factors may be found under the heading "Business Risks" in our management's discussion and analysis for the year ended December 31, 2005 and under "Risk Factors" in our Annual Information Form dated March 29, 2006.

The foregoing list of factors that may affect future results is not exhaustive. When relying on our forward-looking statements to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Furthermore, the forward-looking statements contained in this press release are made as of the date of this press release, and Pengrowth does not undertake any obligation to up-date publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this press release are expressly qualified by this cautionary statement.

Contact Information

  • Pengrowth
    Investor Relations
    (403) 233-0224 or Toll Free: 1-800-223-4122
    (403) 294-0051 (FAX)
    Investor Relations, Toronto
    Toll Free: 1-888-744-1111
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    For media inquiries contact:
    (403) 266-8355
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