Petrominerales Ltd.

Petrominerales Ltd.

June 12, 2012 10:48 ET

Petrominerales Closes US$400 Million Convertible Note Offering

CALGARY, ALBERTA--(Marketwire - June 12, 2012) - Petrominerales Ltd. ("Petrominerales" or the "Company") (TSX:PMG) (BVC:PMGC), is pleased to announce the closing of our previously announced offering ("Offering") of US$400 million principal amount of convertible notes due June 2017 ("Notes"). The Notes are convertible into common shares of Petrominerales with an annual coupon rate of 3.25% and a conversion price of US$18.0017 (Cdn$18.63) per Note, representing a conversion premium of 35% to the closing price of the Petrominerales' share price on the Toronto Stock Exchange on May 31, 2012. As part of the Offering, we have repurchased 10.0 million common shares of Petrominerales from certain offshore holders, representing approximately 10% of the issued and outstanding common shares on May 31, 2012.

We are also pleased to announce that we have closed the repurchase of US$250 million of our existing 2.625% Senior Unsecured Convertible Bonds bearing ISIN NO0010583990 (the "Existing Bonds") under our previously announced Buy-Back Invitation from certain offshore holders (the "Buy-back"). These bonds have been repurchased at 98.5% of par value plus accrued interest, and will now be cancelled. The completion of the Buy-back leaves US$271.8 million principal amount of convertible bonds outstanding with maturity in August 2016 and a potential early redemption option in August 2013.

The Offering and the Buy-back have served as an effective method for Petrominerales to extend our debt maturity profile, minimize dilution and secure inexpensive working capital. In addition, the repurchase of approximately 10% of our outstanding common shares demonstrates confidence in our future business plans and reinforces our focus on per-share production and reserve growth. The net proceeds from these transactions will be used to fund our oil and gas exploration and development activities in Latin America.

The Offering and Buy-back were both led by ABG Sundal Collier Norge ASA, as sole bookrunner.

Petrominerales Ltd. is an international oil and gas company operating in Latin America since 2002. Today, Petrominerales is the most active exploration company and the fourth largest oil producer in Colombia. Our high quality land base and multi-year inventory of exploration opportunities provides long-term growth potential for years to come.

Forward Looking Statements. Certain information provided in this press release constitutes forward looking statements. Specifically, this press release contains forward looking statements relating to the timing for cancellation of the Existing Bonds that were repurchased and planned exploration. The forward looking statements are based on certain key expectations and assumptions, including expectations and assumptions concerning the availability of capital, the receipt of applicable regulatory approvals, the success of future drilling and development activities, the performance of existing wells, the performance of new wells, prevailing commodity prices and economic conditions, the availability of labour and services, the ability to transport and market our production, timing of completion of infrastructure and transportation projects, weather, access to drilling locations and geological and geophysical matters. 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: general economic, market and business conditions; fluctuations in oil prices; the results of exploration and development drilling, recompletions and related activities; timing and rig availability; availability of transportation and offloading capacity, outcome of exploration contract negotiations; 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 forecast. 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.

Contact Information

  • Petrominerales Ltd.
    Corey C. Ruttan
    President and Chief Executive Officer
    403.705.8850 or 011.571.629.2701

    Petrominerales Ltd.
    Jack F. Scott
    Chief Operating Officer
    403.705.8850 or 011.571.629.2701

    Petrominerales Ltd.
    Kelly D. Sledz
    Chief Financial Officer
    403.705.8850 or 011.571.629.2701