CALGARY, Oct. 1, 2012 /CNW/ - Terrex Energy Inc. ("Terrex" or the "Company") (TSX-V: TER) announces that it has received
written notice from Sandstorm Metals & Energy Ltd. ("Sandstorm")
indicating that Terrex is in default under the terms of the Hydrocarbon
Purchase Agreement dated as of March 18, 2011 (the "Purchase
Agreement") among Terrex, Sandstorm and an affiliate of Sandstorm (a
copy of which has been filed on SEDAR at www.sedar.com under the Company's SEDAR profile), due to Terrex's failure to fulfil
certain drilling obligations by the date contemplated by the Purchase
Agreement. Pursuant to the Purchase Agreement, if Terrex does not
remedy the default to Sandstorm's reasonable satisfaction or refund
$1.5 million to Sandstorm within the applicable cure period, Sandstorm
will have the right to, among other things, realize on its security
interest in all of Terrex' assets. Terrex continues to actively pursue
various strategic alternatives including potential financing, merger
and and/or joint venture arrangements in order to continue the
development of its properties and meet its obligations, including those
contained in the Purchase Agreement.
Terrex recently entered into a non-binding letter of intent with an
arms' length public company providing for a potential business
combination, which if consummated in accordance with its proposed
terms, would allow Terrex to cure the default under the Purchase
Agreement. However there is no assurance that the proposed business
combination will be completed and the letter of intent remains subject
to a number of conditions, including approval by the boards of
directors of both parties, approval by Sandstorm, the negotiation of a
definitive agreement, as well as TSX Venture Exchange and shareholder
approval.
ABOUT TERREX
Terrex Energy Inc. is a Calgary based junior oil company that focuses on
the application of proven enhanced oil recovery ("EOR") methods to
improve oil production from existing mature fields. Terrex targets
underexploited and undercapitalized light to medium oil reservoirs in
Western Canada. The Company's shares are listed on the TSX Venture
Exchange under the trading symbol "TER".
ADVISORIES
Forward-Looking Information
This News Release contains forward-looking information within the
meaning of applicable Canadian securities laws. All information other
than historical fact is forward-looking information. Forward-looking
information relates to future events or future performance and is based
on Terrex's current internal expectations, estimates, projections,
assumptions and beliefs. Forward-looking information is often, but not
always, identified by the use of words such as "expect", "project",
"proposed", "intend", "seek", "anticipate", "budget", "plan",
"continue", "estimate", "forecast", "may", "will", "predict",
"potential", "targeting", "could", "might", "should", "believe" and
similar expressions.
Although management considers the assumptions and estimates, reflected
in forward-looking information, to be reasonable, based on information
currently available, there can be no assurance that such information
will prove to be correct. As a consequence, actual results may differ
materially from those anticipated.
In particular, this News Release contains forward-looking information
relating to the Purchase Agreement and to possible transactions which
may arise from the Company's review of strategic alternatives.
Undue reliance should not be placed on forward-looking information which
is inherently uncertain, and subject to known and unknown risks and
uncertainties (both general and specific) that contribute to the
possibility that the future events or circumstances contemplated by the
forward looking information will not occur. These risks include, but
are not limited to risks associated with the Purchase Agreement, risks
associated with completing a strategic transaction, financial risks,
and substantial capital requirements. Further information regarding
these risks may be found under the heading "Risk Factors" in the
company's Annual Information Form. Readers are cautioned that the
foregoing list of factors that may affect future results is not
exhaustive.
The forward-looking statements contained in this news release are made
as of the date hereof and Terrex does not undertake any obligation to
update publicly or to revise any of the included forward-looking
statements, except as required by applicable law. The forward-looking
statements contained herein are expressly qualified by this cautionary
statement.
Neither the TSX Venture Exchange nor its Regulation Service 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: Terrex Energy Inc
<p> For additional information please contact Jonathan Lexier, President & CEO, or Norman Knecht, VP Finance and CFO, at (403) 264-4430, or visit the Company's website at <a href="http://www.terrexenergy.ca">www.terrexenergy.ca</a> </p>