Skope Energy Inc.

Skope Energy Inc.

December 15, 2011 13:31 ET

Skope Energy Inc. Announces Suspension of Its Dividend, Termination of Debenture Financing and the Appointment of an Additional Director

CALGARY, ALBERTA--(Marketwire - Dec. 15, 2011) - Skope Energy Inc. ("Skope" or the "Company") (TSX:SKL) announces that its Board of Directors, at its meeting held today, has determined not to declare a quarterly dividend on its outstanding shares for the current quarter, and further determined that given continuing low natural gas prices and volatile capital markets it is in the best interest of the Company to cease paying dividends to holders of its outstanding shares until the Company reduces its outstanding debt level under its credit facility. Any future dividends will be contingent upon available cash flow, capital spending requirements and outstanding debt levels. Due to adverse market conditions, Skope has also terminated its previously announced public offering of 5 year 8.00% convertible unsecured subordinated debentures due December 31, 2016.

Although the Company is not in default of its covenants under its credit facility, due to low and continued low natural gas prices, the borrowing base of the Company's facility is under review and Skope is in discussion with its lender. The Company is considering various financing alternatives to reduce the indebtedness under its credit facility and strengthen its balance sheet including alternate debt and equity financing.

Skope is pleased to announce the appointment of Mr. Michael J. Hibberd, as a new independent director of the Company. Mr. Hibberd has extensive international energy project planning and capital markets experience. Mr. Hibberd is the president and chief executive officer of MJH Services Inc., a corporate finance advisory company. He is chairman of Heritage Oil Plc., Heritage Oil Corporation, Canacol Energy Ltd. and Greenfields Petroleum Corporation and is co-chairman of Sunshine Oilsands Ltd. He also currently serves on the boards of directors of Montana Exploration Corp. and Pan Orient Energy. As a result of the appointment, the Company's audit committee has also been reconstituted and is now comprised of Robert B. Hodgins C.A. (Chairman), Dr. Edward W. Bogle and Mr. Hibberd.

About Skope Energy Inc.

Skope is in the business of oil and natural gas exploration, development and production in Western Canada with a focus on shallow natural gas. Skope owns an 80% working interest in a package of high quality, long-term, low decline producing shallow gas assets, located in southeast Alberta and southwest Saskatchewan.

Skope's common shares are listed on the Toronto Stock Exchange under the symbol "SKL".

Forward-Looking Statements

This news release contains forward looking statements. These statements relate to future events or the Company's future performance. All information and statements contained herein that are not clearly historical in nature constitute forward looking statements, and the words "may", "will", "should", "could", "expect", "plan", "intend", "anticipate", "believe", "estimate", "propose", "predict", "potential", "continue", or the negative of these terms or other comparable terminology are generally intended to identify forward looking statements. These statements involve known or unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward looking statements. Undue reliance should not be placed on these forward looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur.

Specifically, this news release contains forward looking statements relating to the Company's plans to improve its balance sheet and the future payment of dividends. These forward-looking statements are based on certain assumptions and are subject to a number of risks. Investors are cautioned that such information, although considered reasonable by the Company, may prove to be incorrect. Actual results achieved will vary from the information provided in this news release as a result of numerous known and unknown risks and uncertainties including, the availability of capital on acceptable terms or at all, the risk that the Company's credit facility will not be renewed or renewed on the same terms or that the current borrowing base level of the credit facility will not be maintained at the current level, general economic, market and business conditions, volatility in market prices for crude oil and natural gas and hedging activities related thereto, and limited, unfavourable, or a lack of access to external sources of capital.

Readers are cautioned that the foregoing lists of factors are not exhaustive. The forward-looking statement disclosure contained in this press release are expressly qualified by this cautionary statement.

These forward-looking statements are made as of the date of this press release, or in the case of documents incorporated by reference herein, as of the dates of such documents, and the Company disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.

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