Terrenex Ltd.
TSX VENTURE : TXA

Terrenex Ltd.

February 22, 2008 07:15 ET

Terrenex Announces Acquisition by Questerre

CALGARY, ALBERTA--(Marketwire - Feb. 22, 2008) - Terrenex Ltd. ("Terrenex" or the "Company") (TSX VENTURE:TXA) reported today that it has entered into an agreement to be acquired by Questerre Energy Corporation ("Questerre").

Terrenex is a significant shareholder of Questerre with common directors. Terrenex's assets are 10,698,785 Questerre shares and a working interest in sixteen exploration licenses covering 711,000 acres in the Lowlands. The licenses are held jointly with Questerre and are subject to a farm-in and participation agreement with a major Canadian independent ("Canadian Independent"). In the four licenses earned by the Canadian Independent for drilling Gentilly #1, Terrenex holds a 3.75% working interest. In the remaining 12 licenses, Terrenex currently holds a 15% working interest. Should the Canadian Independent complete its earning obligations on these 12 licenses and Terrenex participate for its proportionate share, Terrenex would have a 3.75% working interest. Terrenex also owns a seismic database of over 5,300 km of 2-D data in the Lowlands.

Terrenex's Quebec assets were valued at $3.474 million by an independent engineering firm retained by the independent directors of Questerre. The total consideration for Terrenex's assets, including 10,698,785 Questerre shares, will be 15,892,785 Questerre shares and the assumption of $0.5 million in net debt. The net debt component will be paid through a non-refundable deposit on the transaction. Based on 4,023,090 Terrenex common shares outstanding, shareholders of Terrenex will receive 3.95 Questerre shares for each Terrenex common share held.

The transaction gains access to capital to develop Terrenex's assets and gives Terrenex's shareholders greater liquidity. All the independent directors of Questerre have approved the acquisition. The independent director of Terrenex has approved the terms of the agreement and is recommending the shareholders of Terrenex approve the transaction. In addition to Terrenex shareholder approval, closing of the transaction is subject to receipt of all regulatory approvals and is scheduled for no later than April 30, 2008.

THE TSX VENTURE EXCHANGE DOES NOT ACCEPT RESPONSIBILITY FOR THE ACCURACY OR ADEQUACY OF THIS RELEASE

Contact Information

  • Terrenex Ltd.
    Michael Binnion
    President
    (403) 777-1185
    (403) 777-1578 (FAX)
    Email: terrenex@cia.com