Petrominerales Ltd.

Petrominerales Ltd.

June 01, 2012 10:04 ET

Petrominerales Prices Convertible Bond Offering

CALGARY, ALBERTA--(Marketwire - June 1, 2012) - Petrominerales Ltd. ("Petrominerales" or the "Company") (TSX:PMG) (BVC:PMGC), is pleased to announce that we have priced our previously announced US$400 million offering (the "Offering") of convertible bonds (the "Bonds").

The Bonds to be issued by Petrominerales are convertible into common shares of Petrominerales, have an annual coupon 3.25% and a conversion price of US$18.0017 (Cdn$18.63) per Bond, representing a conversion premium of 35% to the closing price of the Petrominerales' share price on the Toronto Stock Exchange on May 31, 2012. The Bonds will be issued at 100% of their principal amount and, unless previously redeemed, converted or cancelled, will mature in June 2017. The Bonds are expected to be issued on or about June 12, 2012. The Offering is subject to certain approvals, including the approval of the Toronto Stock Exchange.

We are also pleased to announce that we have received US$250 million in offers from certain offshore holders of the Company's existing 2.625% Senior Unsecured Convertible Bonds bearing ISIN NO0010583990 (the "Existing Bonds") under our previously announced Buy-Back Invitation. These bonds will be bought back at 98.5% of par value plus accrued interest, and will be cancelled as soon as practically possible after June 12, 2012, leaving US$271.8 million principal amount of convertible bonds outstanding with a maturity of August 25, 2016 and a potential early redemption option in August 2013.

As part of the Offering, we have repurchased 10.0 million common shares of Petrominerales, representing 10% of the issued and outstanding common shares on May 31, 2012.

The Company believes that these transactions represent an effective method for Petrominerales to extend its 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 remaining net proceeds from these transactions will be used to fund our oil and gas exploration and development activities in Latin America.

ABG Sundal Collier Norge ASA has been engaged as the sole manager for both the Offering and the Buy-Back Invitation.

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 Company's future exploration and development activities, the use of proceeds from the Offering and the timing for completion of the Offering and the Invitation. 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 and access to drilling locations. 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