CALGARY, July 4, 2013 /CNW/ - Bengal Energy (TSX:
BNG) ("Bengal", or the "Company") is pleased to announce that
it will be conducting a non-brokered private placement of 8,000
units ("Units") of the Company at a price of $1,000 per Unit for aggregate gross proceeds of
$8.0 million (the "Private
Placement"). The proceeds from the Private Placement will be
used to fund the Company's previously announced exercise of a
pre-emptive right to purchase an additional 5.357% interest in the
Cuisinier Oil Field and Authority to Prospect ("ATP") 752P (the
"Acquisition") in the Cooper-Eromanga Basin in Queensland, Australia,. Upon completion
of the Acquisition, the Company's total ownership in Cuisinier will
increase to 30.357%, resulting in Bengal's net production
participation increasing by more than 20%.
Each Unit will consist of $1,000 principal amount of 10% unsecured
non-convertible redeemable notes ("Notes") and either: (i) 156.25
common share purchase warrants ("Warrants"), in the case of
subscriptions by non-insiders, or (ii) 156.25 value appreciation
rights ("VARs"), in the case of subscriptions by insiders.
The Notes bear interest at a rate of 10% per annum, payable
quarterly, and have a term of 36 months. Following the first
anniversary of the closing date (the "Closing Date") of the Private
Placement, the Company shall be required to make quarterly
repayments of the outstanding principal of Notes in an amount equal
to 6.25% of the principal amount of Notes outstanding on the last
day of each applicable quarter. Each whole Warrant entitles
the holder thereof, for a period of 36 months following the Closing
Date, to acquire one common share (a "Common Share") in the capital
of the Company at a purchase price equal to $0.75 per Common Share. Each whole VAR
entitles the holder thereof, for a period of 36 months following
the Closing Date, to exercise the VAR and thereby receive a cash
payment equal to the difference between the market price of one
Common Share on the exercise date and $0.75. Certain insiders of the Company are
expected to purchase 3,500 Units under the Private Placement,
representing over 40% of the Notes. The Private Placement is
anticipated to close on or around July 5,
2013.
"We are very pleased to increase our ownership
in Cuisinier, a key light oil, high netback producing property,"
said Chayan Chakrabarty, Bengal's
President & CEO. "Our strong balance sheet enabled us to
finance the Acquisition quickly, positioning us to benefit from a
larger proportion of the production and resultant cash flows, as
well as gaining greater exposure to the future upside we believe is
inherent in Cuisinier."
This press release does not constitute an offer
of the Notes, Warrants (or the Common Shares issuable on the
exercise thereof) or the VARs (collectively, the "Securities") for
sale in the United States or in
any jurisdiction in which such offer or sale would be
unlawful. The Securities have not been registered under
the United States Securities
Act of 1933, as amended, and may not be offered or sold within
the United States absent
registration or an exemption from registration under that Act.
All Securities issued in connection with the
Private Placement will be subject to a statutory hold period of
four months plus one day from the Closing Date in accordance with
applicable securities law.
About Bengal
Bengal Energy Ltd. is an international junior oil and gas
exploration and production company based in Calgary, Alberta. The Company is committed to
growing shareholder value through international exploration,
production and acquisitions. Bengal trades on the TSX under the
symbol BNG. Additional information is available at
www.bengalenergy.ca.
This news release contains certain
forward-looking statements or information ("forward-looking
statements") as defined by applicable securities laws that involve
substantial known and unknown risks and uncertainties, many of
which are beyond Bengal's control. These forward-looking
statements relate to future events or our future performance.
All statements other than statements of historical fact may be
forward-looking statements. The use of any of the words
"plan", "expect", "prospective", "project", "intend", "believe",
"should", "anticipate", "estimate", or other similar words or
statements that certain events "may" or "will" occur are intended
to identify forward-looking statements. The projections,
estimates and beliefs contained in such forward-looking statements
are based on management's estimates, opinions, and assumptions at
the time the statements were made, including, without limitation,
assumptions relating to: the impact of economic conditions in
North America, Australia, India and globally; industry conditions;
changes in laws and regulations including, without limitation, the
adoption of new environmental laws and regulations and changes in
how they are interpreted and enforced; increased competition;
the availability of qualified operating or management personnel;
fluctuations in commodity prices, foreign exchange or interest
rates; stock market volatility and fluctuations in market
valuations of companies with respect to announced transactions and
the final valuations thereof; and the ability to obtain required
approvals and extensions from regulatory authorities. We
believe the expectations reflected in those forward-looking
statements are reasonable but, no assurances 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
Bengal will derive from them. As such, undue reliance should
not be placed on forward-looking statements. Forward-looking
statements contained herein include, but are not limited to,
statements regarding: the use of proceeds from the Private
Placement; the closing of the Private Placement; the number of
Units to be subscribed for by insiders and non-insiders; the terms
of the Securities and receipt of regulatory approvals in respect of
the Private Placement; completion of the Acquisition; and the
benefits of the Acquisition. The forward-looking statements
contained herein are subject to numerous known and unknown risks
and uncertainties that may cause Bengal's actual financial results,
performance or achievement in future periods to differ materially
from those expressed in, or implied by, these forward-looking
statements, including but not limited to, risks associated with:
the failure to obtain required safety assessments and rig
acceptance; failure to secure required equipment and personnel;
changes in general global economic conditions including, without
limitations, the economic conditions in North America, Australia, India; increased competition; the availability
of qualified operating or management personnel; fluctuations in
commodity prices, foreign exchange or interest rates; changes in
laws and regulations including, without limitation, the adoption of
new environmental and tax laws and regulations and changes in how
they are interpreted and enforced; the results of exploration and
development drilling and related activities; the ability to access
sufficient capital from internal and external sources; failure to
obtain or delays in obtaining regulatory approvals; delays or
changes in planned operations; operational risks associated with
exploration, development and production; the results of geological,
geophysical and reservoir analysis; results of drilling and seismic
activities; results of due diligence investigations; and stock
market volatility. Readers are encouraged to review the
material risks discussed in Bengal's Annual Information Form under
the heading "Risk Factors" and in Bengal's annual MD&A under
the heading "Risk Factors". The Company cautions that the
foregoing list of assumptions, risks and uncertainties is not
exhaustive. The forward-looking statements contained in this
news release speak only as of the date hereof and Bengal does not
assume any obligation to publicly update or revise them to reflect
new events or circumstances, except as may be require pursuant to
applicable securities laws.
SOURCE Bengal Energy Ltd.