Coastal Energy Announces Cdn$16 million Bought-Deal Financing



    
    /THIS NEWS RELEASE IS NOT FOR DISSEMINATION IN THE UNITED STATES
    OR THROUGH UNITED STATES NEWSWIRE SERVICES/

    AIM: CEO
    TSX-V: CEN
    

    HOUSTON, May 6 /CNW/ - Coastal Energy Company ("the Company" or "Coastal
Energy") (TSX-V: CEN, AIM: CEO), an independent exploration and production
company with assets in Southeast Asia, announces that it has entered into an
agreement with a syndicate of underwriters co-led by Thomas Weisel Partners
Canada Inc. and Paradigm Capital Inc. (collectively the "Underwriters" or
"Syndicate"), whereby the Underwriters have agreed to purchase, on a bought
deal basis, 5,000,000 common shares of Coastal Energy at Cdn$3.20 per common
share ("the Offering") to raise gross proceeds of Cdn$16,000,000. The Company
will also grant the Underwriters an option to purchase an additional 750,000
common shares exercisable at a price of Cdn$3.20 per common share for a period
of 30 days from the closing date (the "Over-allotment Option"). If the
Over-allotment option is exercised in full, additional gross proceeds will be
approximately Cdn$2,400,000 for total gross proceeds of Cdn$18,400,000. The
Offering is scheduled to close in late May 2009 and is subject to Coastal
Energy obtaining necessary regulatory approvals.
    The Company will use the proceeds of the Offering for general corporate
purposes.
    The Common Shares to be issued under the Offering will be offered: (a) by
way of a short form prospectus to be filed in Alberta, British Columbia,
Ontario and such other Canadian provinces or territories as the syndicate and
the Company may agree; (b) in the United States on a private placement basis
pursuant to exemptions from the registration and prospectus requirements of
the United States Securities Act of 1933; and (c) in Europe and other eligible
foreign jurisdictions in accordance with applicable local securities
legislation and regulations such that no prospectus, registration statement or
similar document is required to be filed in any such jurisdiction.

    
    Notes to Editors

    -   Coastal Energy is an oil and gas exploration and production company
        with core assets onshore and offshore Thailand

    -   The Company specialises in identifying and developing under-exploited
        or "orphaned" assets. Management has proven experience at identifying
        and unlocking value from overlooked, abandoned, low risk assets with
        proven hydrocarbon potential

    -   The Company has current production of approximately 10,000 barrels of
        oil per day and 12.6 mmcf/d of gas.

    -   Production growth over the next 12 -18 months is expected to be
        substantial. Proven and probable reserves are 62.2 million barrels
        oil equivalent in the Company's reserve report prepared by Huddleston
        & Co. dated 14 April, 2009 (effective date of 31 December, 2008)(*)

    -   The Company's current assets include:

        -  Offshore Thailand
        -  100% of block G5/43 - two oil fields currently under development
           with several other similar appraisal and exploration
           opportunities. Current production from the Songkhla field is
           approximately 10,000 bbl/d.
        -  100% of block G5/50 - within the boundaries of block G5/43 in the
           Ko Kra basin

    -   Onshore Thailand

        -  12.6% net interest in the Phu Horm gas field, which has average
           daily production of 100 mmcf/d as of March 31, 2009.
    

    Additional information may be found on the Company's website,
www.CoastalEnergy.com or may be found in documents filed on SEDAR,
www.sedar.com.
    This statement contains 'forward-looking statements' as defined by the
applicable securities legislation. Statements relating to current and future
drilling results, existence and recoverability of potential hydrocarbon
reserves, production amounts or revenues, forward capital expenditures,
operation costs, oil and gas price forecasts and similar matters are based on
current data and information and should be viewed as forward-looking
statements. Such statements are not guarantees of future results and are
subject to risks and uncertainties beyond Coastal Energy's control. Actual
results may differ substantially from the forward-looking statements.

    
    (*) Per barrel of oil equivalent ("boe") amounts have been calculated
        using a conversion rate of six thousand cubic feet of natural gas to
        one barrel of oil equivalent (6:1). The term boe may be misleading,
        particularly if used in isolation. A boe conversion ratio of 6mcf to
        1bbl of oil is based upon an energy equivalency conversion method
        primarily applicable at the burner tip and does not represent a value
        equivalency at the wellhead.
    

    These securities have not been registered under United States Securities
Act of 1933 (the "US Securities Act") or the securities laws of any state and
may not be offered or sold in the United States or to US persons (as defined
in Regulation S under the US Securities Act) unless an exemption from
registration is available.

    
    "The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this release"
    





For further information:

For further information: Coastal Energy Company: Randy L. Bartley, Chief
Executive Officer, (713)877-6705; William C. Phelps, Chief Financial Officer,
(713) 877-6727, Email: investor@CoastalEnergy.com; Strand Partners Limited
(Nominated Adviser) +44 (0) 20 7409 3494, Rory Murphy; Thomas Weisel Partners
(Broker), +44 (0) 20 7877 4300, Paul Colucci; Tristone Capital (Broker), +44
(0) 20 7355 5800, Majid Shafiq; Bell Pottinger Corporate & Financial, Nick
Lambert / Rosanne Perry, +44 (0) 20 7861 3232

Organization Profile

COASTAL ENERGY COMPANY

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