Petro Andina Resources Inc.
TSX : PAR

Petro Andina Resources Inc.

August 17, 2009 08:00 ET

Petro Andina Continues to Recommend Rejection of the Pluspetrol Offer and Is Negotiating Alternative Proposals

CALGARY, ALBERTA--(Marketwire - Aug. 17, 2009) - The Board of Directors of Petro Andina Resources Inc. (TSX:PAR) (Petro Andina or the Company) wishes to reiterate its unanimous recommendation that shareholders reject the unsolicited offer (Pluspetrol Offer) to acquire Petro Andina by 1462627 Alberta Ltd, a wholly-owned subsidiary of Pluspetrol Resources Corporation N.V., and not tender their shares to the Pluspetrol Offer.

In response to the Pluspetrol Offer, the Board of Directors, through its financial advisors, is conducting a value maximization process designed to generate superior alternatives to the Pluspetrol Offer. As a result of that process, Petro Andina has received proposals from qualified interested parties and negotiations are currently underway with those parties. The Company is very pleased with the level of interest received and the pace of the shareholder value maximization process to date. There is no assurance that such negotiations will result in a transaction.

It is important to note that Petro Andina has a diverse asset base of production, oil reserves and exploration potential, and for that reason the shareholder value maximization process requires that adequate time be provided to ensure that all alternatives are fully evaluated. Petro Andina continues to work on behalf of shareholders to maximize value and expects to update shareholders as appropriate.

On July 3, 2009, Petro Andina's Board of Directors unanimously recommended that Petro Andina shareholders reject the Pluspetrol Offer for the reasons set out in the Petro Andina directors' circular dated July 3, 2009.

Shareholders do not have to take any action on the Pluspetrol Offer and Petro Andina's Board of Directors urges you to reject it.

For assistance in withdrawing any shares already tendered, or other questions, please contact Kingsdale Shareholder Services Inc., the Information Agent retained by Petro Andina in connection with the Pluspetrol Offer, toll free at 1-866-581-0508 or email contactus@kingsdaleshareholder.com.

About Petro Andina Resources Inc.

Petro Andina is engaged in oil and natural gas exploration, development and production in South America and the Caribbean region. The Company is continuing to develop its existing reserves and to conduct appraisal and exploration drilling on its 628,000 acre (346,000 net acre) land position in the Neuquen Basin of Argentina. Exploration activities have also begun on its 495,000 acre (247,500 net acre) holdings in the Llanos Basin of Colombia and 211,000 acre (105,000 net acre) holdings onshore Trinidad & Tobago. Petro Andina is headquartered in Calgary, Canada.

Forward-Looking Statements

Certain statements regarding Petro Andina Resources Inc., including management's assessment of future plans and operations and statements with respect to the Pluspetrol Offer and potential alternative transactions, may constitute forward-looking statements under applicable securities laws and necessarily involve known and unknown risks and uncertainties, most of which are beyond Petro Andina's control. These risks may cause actual financial and operating results, performance, levels of activity and achievements to differ materially from those expressed in, or implied by, such forward-looking statements.

Such risks and uncertainties include, but are not limited to: the impact of general economic conditions in Canada, Argentina, Colombia and Trinidad & Tobago, industry conditions including changes in laws and regulations including adoption of new environmental laws and regulations, and changes in how they are interpreted and enforced, in Canada, Argentina, Colombia and Trinidad & Tobago, competition, the lack of availability of qualified personnel, fluctuations in commodity prices, the results of exploration and development drilling and related activities, imprecision in reserve estimates, the production and growth potential of Petro Andina's assets, fluctuations in foreign exchange or interest rates, the ability to access sufficient capital from internal and external sources, obtaining required approvals of regulatory authorities, in Canada, Argentina, Colombia and Trinidad & Tobago and the inability of Petro Andina to negotiate an alternative transaction that provides superior value for shareholders. Many of these risk factors are discussed in further detail in the Company's Annual Information Form dated March 31, 2009 on file with Canadian securities commissions. Readers are also referred to the risk factors described in other documents that Petro Andina files from time to time with securities regulatory authorities.

Accordingly, Petro Andina gives no assurance nor makes any representations or warranty that the expectations conveyed by the forward-looking statements will prove to be correct and actual results may differ materially from those anticipated in the forward-looking statements. Petro Andina undertakes no obligation to publicly update or revise any forward-looking statements.

Contact Information

  • Petro Andina Resources Inc.
    Michael Kruchten
    Investor Relations
    (403) 517-1733
    (403) 265-8216 (FAX)
    or
    Petro Andina Resources Inc.
    Kenneth G. Pinsky
    Vice President, Finance and Chief Financial Officer
    (403) 517-1729
    (403) 265-8216 (FAX)