DALLAS, March 15, 2013 /CNW/ - Gale Force Petroleum Inc. (TSXV: GFP) (OTCQX: GFPMF) (the "Company" or "Gale Force") today announced that it has entered into agreements to sell its Gregg
& Rusk Counties Properties and its Oklahoma Properties, for an
aggregate selling price of $6.5 million.
"Selling these properties is part of Gale Force's strategy to generate
capital without causing any dilution, strengthen our balance sheet, and
begin a new capital investment program in key development prospects",
said Michael McLellan, Co-Chairman & CEO. "With these transactions
behind us, we will have streamlined our business, and will begin
immediately investing capital to resume production growth and to prove
up the value of our core assets".
The Company has sold its properties in Gregg & Rusk Counties for a total
of $5.85 million, of which $5.55 million was paid today, with the
remaining $300,000 expected in June, 2013.
The Company also entered into a purchase and sale agreement to sell its
core interests in Oklahoma, for a total of $650,000, which it expects
to close within 30 days.
From the proceeds of the sale of the properties, the Company has first
paid down $4.5 million on its line of credit, which will leave the
Company with $2.0 million working capital from which it will invest in
existing development opportunities, seeking to replace the sold
production without taking on any additional debt.
The Company's bank line of credit will have a borrowing base of $5.5
million, has an interest rate of 5.0%, and continues to be
interest-only at least until after the next borrowing-base
redetermination is carried out in September, 2013.
ABOUT GALE FORCE PETROLEUM INC. − www.GaleForcePetroleum.com
Gale Force Petroleum is a public corporation focused on acquiring and
exploiting underdeveloped and undervalued oil and gas reserves in
mature basins, bringing operational expertise and capital to
lower-risk, development-type projects. The Company currently owns
producing oil and gas properties in Texas, Oklahoma, Tennessee and West
"Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release."
SOURCE: GALE FORCE PETROLEUM INC.
For further information:
Michael McLellan, CFA, Co-Chairman & CEO, +1.888.440.3411