Petrobank Energy and Resources Ltd.
TSX : PBG

Petrobank Energy and Resources Ltd.

April 27, 2009 17:03 ET

Petrobank Announces $101 Million Bought Deal Petrominerales Secondary Offering

CALGARY, ALBERTA--(Marketwire - April 27, 2009) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Petrobank Energy and Resources Ltd. ("Petrobank") (TSX:PBG) is pleased to announce that Petro International Ltd. (the "Selling Shareholder") has entered into an agreement with a syndicate of investment dealers, led by TD Securities Inc. and Haywood Securities Inc. (the "Underwriters"), pursuant to which the Underwriters have agreed to purchase for resale to the public, on a "bought deal" basis, an aggregate of 9.9 million common shares ("Common Shares") of Petrominerales Ltd. ("Petrominerales") from the Selling Shareholder at a price of $10.25 per Common Share resulting in gross proceeds of $101,475,000 (the "Secondary Offering"). Petrominerales is a 76.8% owned subsidiary of Petrobank and the Selling Shareholder is a wholly-owned subsidiary of Petrobank. A preliminary short form prospectus to qualify the Secondary Offering for distribution to the public will be filed with securities regulatory authorities in the provinces of Canada (other than Quebec) on or before May 1, 2009.

The Secondary Offering will reduce Petrobank's ownership of Petrominerales to 66.7% and is expected to enhance the market liquidity of Petrominerales through an increased public float. The proceeds from the offering will further improve Petrobank's balance sheet strength and financial flexibility by reducing bank debt outstanding and potentially lead to an expanded 2009 drilling program focused on the Bakken light oil play in southeast Saskatchewan.

The Secondary Offering is subject to certain conditions including, the approval of the Toronto Stock Exchange and other standard regulatory approvals. The Common Shares will be offered in all provinces of Canada (except Quebec) by way of a short form prospectus. Closing is anticipated to occur on or about May 15, 2009. Petrominerales will not receive any proceeds from the Secondary Offering.

Certain information provided in this press release constitutes forward-looking statements. The words "anticipate", "expect", "project", "estimate", "forecast" and similar expressions are intended to identify such forward-looking statements. Specifically, this press release contains forward-looking statements relating to a secondary offering of common shares of the Company. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be incorrect. Actual results achieved during the forecast period will vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors. You can find a discussion of those risks and uncertainties in our Canadian securities filings. Such factors include, but are not limited to: with respect to the anticipated closing dates of the Secondary Offering, expectations and assumptions concerning the obtaining of the necessary regulatory approvals and the satisfaction of applicable conditions, and economic, market, financial market and business conditions; fluctuations in oil prices; the results of exploration and development drilling; timing and rig availability, fluctuation in foreign currency exchange rates; the uncertainty of reserve estimates; changes in environmental and other regulations; risks associated with oil and gas operations; and other factors, many of which are beyond the control of the Company. There is no representation by Petrominerales that actual results achieved during the forecast period will be the same in whole or in part as those forecasted. Except as may be required by applicable securities laws, Petrominerales assumes no obligation to publicly update or revise any forward-looking statements made herein or otherwise, whether as a result of new information, future events or otherwise.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction. The shares offered have not and will not be registered under the United States Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirement.

Petrobank Energy and Resources Ltd. is a Calgary-based oil and natural gas exploration and production company with operations in western Canada and Latin America. The Company operates high-impact projects through three business units and a technology subsidiary. The Canadian Business Unit is focused on developing a solid production platform from the Bakken light oil play in southeast Saskatchewan, and exploiting a large undeveloped land base through the application of new technology to large oil and gas resource opportunities. The Latin American Business Unit, operated by Petrobank's 76.8% owned TSX-listed subsidiary, Petrominerales Ltd. (TSX:PMG), is a Latin American-based exploration and production company producing oil in Colombia with 16 exploration blocks covering a total of 1.9 million acres in the Llanos and Putumayo Basins of Colombia and 2.6 million acres in the Ucayali Basin of Peru. Whitesands Insitu Partnership, a partnership between Petrobank and its wholly-owned subsidiary Whitesands Insitu Inc., owns 75 net sections of oil sands leases in Alberta, 36 sections of oil sands licenses in Saskatchewan and operates the Whitesands project which is field-demonstrating Petrobank's patented THAI™ heavy oil recovery process. THAI™ is an evolutionary in-situ combustion technology for the recovery of bitumen and heavy oil that integrates existing proven technologies and provides the opportunity to create a step change in the development of heavy oil resources globally. THAI™ and CAPRI™ are registered trademarks of Archon Technologies Ltd., a wholly-owned subsidiary of Petrobank.

Contact Information

  • Petrobank Energy and Resources Ltd.
    John D. Wright
    President and Chief Executive Officer
    403.750.4400
    or
    Petrobank Energy and Resources Ltd.
    Chris J. Bloomer
    Senior Vice President and Chief Operating Officer, Heavy Oil
    403.750.4400
    or
    Petrobank Energy and Resources Ltd.
    Corey C. Ruttan
    Senior Vice President and Chief Financial Officer
    403.750.4400
    or
    Petrobank Energy and Resources Ltd.
    R. Gregg Smith
    Senior Vice President and Chief Operating Officer, Canada
    403.750.4400