| Connacher increases size of bought deal financing 10:28 EDT Tuesday, October 06, 2009 | |
CALGARY, Oct. 6 /CNW/ - Connacher Oil and Gas Limited (CLL-TSX) ("Connacher" or the "Corporation") announces today that it has agreed to increase the size of the financing announced after market close yesterday. The Corporation will now issue 20,150,000 flow-through common shares ("Flow-Through Shares") on a "bought deal" basis for gross proceeds of approximately $26 million ($1.30 per Flow-Through Share). Connacher has granted the underwriters an over-allotment option to purchase up to an additional 3,022,500 Flow-Through Shares on the same terms and conditions, exercisable in whole or in part up to 30 days following closing of the offering, for aggregate gross proceeds of approximately $30 million. The underwriting syndicate is led by RBC Capital Markets and includes TD Securities Inc., GMP Securities L.P., Raymond James Ltd., D&D Securities Company, and Macquarie Capital Markets Canada Inc. The offering is scheduled to close on or about October 22, 2009.
Connacher will use the gross proceeds from the sale of the Flow-Through Shares to pay exploration expenses on the Corporation's properties which qualify as Canadian Exploration Expenses (as such term is defined in the Income Tax Act (Canada)). It is anticipated that the net proceeds will primarily be used to further delineate and define Connacher's oil sands properties through the drilling of additional core holes and for conducting a three-dimensional (3-D) seismic program over Connacher's oil sands properties. Connacher remains positive about, and committed to, the exploration of its oil sands acreage to enhance its reserve and resource base which is anticipated to support future bitumen production growth.
A preliminary short-form prospectus will be filed with securities regulatory authorities in all provinces of Canada except Quebec. The offering is subject to the approval of such securities regulatory authorities, in addition to approval by the Toronto Stock Exchange.
This press release is not an offer to sell securities or the solicitation of an offer to buy securities in any jurisdiction. Securities may not be offered or sold in the United States absent registration or an applicable exemption from registration.
Connacher Oil and Gas Limited is a Calgary-based integrated oil company. Its primary upstream production is from oil sands operations at its 10,000 bbl/d Pod One SAGD plant in northeastern Alberta. The company has reactivated its construction activities and has fully funded a second similar-sized SAGD oil sands project in Great Divide at Algar. It has conventional crude oil and natural gas production of approximately 3,100 boe/d in Alberta and Saskatchewan, a downstream operation with a 9,500 bbl/d heavy oil refinery in Great Falls, Montana and maintains a 22 percent equity stake in Petrolifera Petroleum Limited (PDP-TSX), a production and exploration company active in Argentina, Colombia and Peru in South America.
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