TUSK Energy Corporation

TUSK Energy Corporation

February 24, 2005 09:36 ET

TUSK Energy Corporation: $31,500,000 Bought Deal Private Placement


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: TUSK ENERGY CORPORATION

TSX SYMBOL: TSK

FEBRUARY 24, 2005 - 09:36 ET

TUSK Energy Corporation: $31,500,000 Bought Deal
Private Placement

CALGARY, ALBERTA--(CCNMatthews - Feb. 24, 2005) - Not for dissemination
to United States Newswire Services or dissemination in the United States

TUSK Energy Corporation (TSX:TSK)("TUSK") is pleased to announce that it
has entered into a bought deal private placement financing agreement
with a syndicate of underwriters led by Orion Securities Inc. and
including Canaccord Capital Corporation, Raymond James Ltd. and Brant
Securities Limited. Total gross proceeds are $31,500,000 (the
"Offering"). The Offering will consist of 7,000,000 common shares at
$4.50 per common share. The Offering is subject to normal regulatory
approval and is expected to close on or about March 14, 2005.

The net proceeds received by the Company from the offering of common
shares will be used for working capital and/or expanded capital
expenditures. The issue will be offered in Alberta, British Columbia,
Manitoba, Saskatchewan and Ontario and to Qualified Institutional Buyers
in the United States pursuant to appropriate registration exemptions.

TUSK currently has approximately 28.0 million common shares. Pro forma
the Offering, the total number of common shares issued and outstanding
will be approximately 35.0 million.

Forward Looking Statements - Some of the statements contained in this
news release are forward-looking statements. Forward-looking statements
may include, but are not limited to, statements concerning estimates of
recoverable hydrocarbons, expected hydrocarbon prices, expected costs,
statements relating to the continued advancement of the Company's
projects and other statements which are not historical facts. When used
in this document, and in other published information of TUSK, the words
such as "could," "estimate," "expect," "intend," "may," "potential,"
"should," and similar expressions are indicative of a forward-looking
statement. Although TUSK believes that its expectations reflected in the
forward-looking statements are reasonable, the potential results
suggested by such statements involve risk and uncertainties and no
assurance can be given that actual results will be consistent with these
forward-looking statements. Various factors, which could cause actual
results to differ from these forward-looking statements, include the
potential that TUSK's projects will experience technical and mechanical
problems, geological conditions in the reservoir which may negatively
impact levels of oil and gas production and changes in product prices
and other risks not anticipated by TUSK or disclosed in TUSK's published
material. Since forward-looking statements address future events and
conditions, by their very nature, they involve inherent risks and
uncertainties.

Barrels of Oil Equivalent - Boe may be misleading, particularly if used
in isolation. A boe conversion ratio of six mcf is based on an energy
equivalency conversion method primarily applicable at the burner tip and
does not represent a value equivalency at the wellhead. The conversion
ratio is an industry accepted norm and is not based on either energy
content of current prices.


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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    TUSK Energy Corporation
    Norman W. Holton
    Chairman
    (403) 264-8875
    or
    TUSK Energy Corporation
    Ian T. Brown
    President
    (403) 264-8875
    (403) 264-8861 (FAX)
    tusk@tusk-energy.com
    www.tusk-energy.com