Sequoia Oil & Gas Trust

Sequoia Oil & Gas Trust

July 25, 2005 17:33 ET

Sequoia Oil & Gas Trust Announces Equity Financing

CALGARY, ALBERTA--(CCNMatthews - July 25, 2005) - Sequoia Oil & Gas Trust ("Sequoia" or the "Trust") (TSX:SQE.UN) is pleased to announce that it has filed a preliminary prospectus for a proposed marketed public offering of Trust Units through a syndicate of underwriters to be led by CIBC World Markets Inc. and including Canaccord Capital Corporation, National Bank Financial Inc., BMO Nesbitt Burns Inc., GMP Securities Ltd., Scotia Capital Inc., TD Securities Inc., First Associates Investments Inc., Orion Securities Inc., Sprott Securities Inc. and Tristone Capital Inc. The preliminary prospectus has been filed in all provinces of Canada, excluding Quebec, Nova Scotia, and Newfoundland and Labrador.

Sequoia expects to raise approximately $50 million through the new issue of trust units. Net proceeds from the financing will be used to partially repay outstanding borrowings under Sequoia's existing credit facilities. The freed up credit capacity will be used to fund the acquisition of Dynamic Oil & Gas Inc.'s oil and natural gas assets located in the Province of Alberta pursuant to a Plan of Arrangement previously announced on July 21, 2005, to fund ongoing capital expenditures and for general corporate purposes.

Sequoia is a growth-oriented oil and natural gas trust with a high quality, diversified asset base. Its mandate is to generate stable monthly distributions and grow production and reserves per unit by focusing on low-cost operations, active development of the Trust's resource base and value-enhancing acquisitions of oil and natural gas properties.

The underwriters have agreed not to offer, sell or deliver the Trust Units offered hereunder, as part of the distribution of such Trust Units at any time, within the United States or to, or for the benefit or account of, U.S. persons except under applicable exemptions from the registration requirements of the United States Securities Act of 1933. This news release shall not constitute an offer to sell, or the solicitation of an offer to buy, Trust Units in the United States, nor shall there be any sale of the 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 any such jurisdiction. The Trust Units may not be offered or sold in the United States absent registration under the United States Securities Act of 1933 or an applicable exemption from the registration requirements.

Forward-Looking Statements - Certain information regarding Sequoia set forth in this document, including management's assessment of Sequoia's future plans and operations, contains forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond Sequoia's control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, the lack of availability of qualified personnel or management, stock market volatility and ability to access sufficient capital from internal and external sources. Sequoia's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that Sequoia will derive therefrom.


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