Connacher Sells Its Halfway Creek Interests

CALGARY, Sept. 30, 2011 /CNW/ - Connacher Oil and Gas Limited (CLL-TSX) announced today that following an auction process, it has sold its undivided 50 percent working interest in lands at Halfway Creek, Alberta, situated south of Fort McMurray, for a cash consideration of $26.8 million, before transaction costs.  Proceeds will be added to working capital to reduce the company's net indebtedness.  As a result, Connacher now has cash balances in excess of $75 million and anticipates monetizing other non-strategic assets, including the already-announced sale of its interests in Latornell and a timely sale of its shareholding in Gran Tierra Energy Inc.

RBC Capital Markets advised Connacher on the transaction.

Connacher is a Calgary-based company engaged in bitumen production using steam assisted gravity drainage ("SAGD") in situ recovery techniques at its Great Divide oil sands operation.  The company is also engaged in oil resource development projects using long reach horizontal wells and multifrac completion technology in central Alberta at Twining and Penhold and owns and operates a profitable heavy oil refinery situated in Great Falls, Montana.

Forward Looking Information

This press release contains forward looking information relating to Connacher's plans to monetize additional non-strategic assets such as Latornell and its shareholding in Gran Tierra Energy Inc. Forward looking information is based on management's expectations regarding results of operations, production, future commodity prices and foreign exchange rates, future capital and other expenditures, environmental matters, business prospects and opportunities and future economic and market conditions.  There can be no assurance that the process to sell Connacher's non-strategic assets will result in offers that will be acceptable to the company and there are risks, including market risks and commercial risks, associated with the completion of a sale transaction. In addition, market volatility and economic uncertainty may impact the timing and/or decision to sell Connacher's shareholding in Gran Tierra Energy Inc.  Additional risks and uncertainties are described in further detail in Connacher's Annual Information Form for the year ended December 31, 2010 which is available at www.sedar.com. Although Connacher believes that the expectations in such forward looking information are reasonable, there can be no assurance that such expectations shall prove to be correct. The forward looking information included in this press release is expressly qualified in its entirety by this cautionary statement. The forward looking information included in this press release is made as of the date hereof and Connacher assumes no obligation to update or revise any forward looking information to reflect new events or circumstances, except as required by law.

SOURCE Connacher Oil and Gas Limited

For further information:

Richard A. Gusella
Chairman and Chief Executive Officer

OR

Peter D. Sametz
President and Chief Operating Officer

OR

Grant D. Ukrainetz
Vice President, Corporate Development

Phone: (403) 538-6201
inquiries@connacheroil.com





Fax:  (403) 538-6225
Website: connacheroil.com

 


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