Argent Energy Trust announces closing of bought deal trust unit financing and acquisition of producing oil properties

/NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES/

CALGARY, Oct. 25, 2012 /CNW/ - Argent Energy Trust ("Argent" or the "Trust") (TSX: AET.UN) is pleased to announce that it has completed its previously announced bought deal financing and has issued 12,650,000 trust units of the Trust (the "Units") at a price of $10.00 per Unit (the "Offering"), which includes 1,650,000 Units issued on the exercise in full of the over-allotment option granted to the underwriters. Total gross proceeds of the Offering to the Trust were $126,500,000.  The underwriting syndicate was co-led by Scotiabank, CIBC and RBC Capital Markets, and included BMO Capital Markets, TD Securities Inc., National Bank Financial Inc., Canaccord Genuity Corp., FirstEnergy Capital Corp., Acumen Capital Finance Partners Limited, Cormark Securities Inc., Dundee Securities Ltd. and GMP Securities L.P.

The Trust is also pleased to announce the closing of its previously announced acquistion of producing petroleum properties in the Manvel Field in Brazoria County, Texas and the NE Davis, SW Mayville and Payne Fields in Southern Oklahoma (the "Acquired Assets") for a purchase price of approximately US$131.7 million, after closing adjustments (the "Acquisition"). The Acquired Assets are principally oil properties covering approximately 4,030 net acres of land with total estimated gross reserves of approximately 3.9 million barrel of oil equivalent ("boe") on a proved basis and approximately 5.7 million boe on a proved plus probable basis as at December 31, 2011.  Working interest before royalty production from the Acquired Assets in June 2012 was approximately 890 boe per day.  Oil represents approximately 94% of the total proved plus probable reserves volumes and natural gas represents the remaining 6%.  The Acquisition was funded by the net proceeds of the Offering, an advance of approximately US$6.1 million under Argent's credit facility and approximately US$6.6 million of working capital.

In conjunction with the Acquisition and as previously announced, Argent also increased the borrowing base of its existing credit facility from US$8 million to US$45 million, of which approximately $6.1 million is drawn following the closing of the Acqusition.

No securities regulatory authority has either approved or disapproved of the contents of this news release.  The securities being offered have not been, and will not be, registered under the United States Securities Act of 1933, as amended, or any state securities laws, and may not be offered or sold in the United States unless pursuant to an exemption therefrom.  This press release is for information purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any securities of Argent Energy Trust in any jurisdiction.

About Argent Energy Trust

Argent is a mutual fund trust under the Income Tax Act (Canada).  Argent's objective is to create stable, consistent returns for investors through the acquisition and development of oil and natural gas reserves and production with low risk exploitation potential, located primarily in the United States.

Argent's Units are traded on the Toronto Stock Exchange under the symbol AET.UN.

Forward Looking Statements

This press release includes forward-looking information within the meaning of applicable Canadian and United States securities legislation.  All statements, other than statements of historical fact, that address activities, circumstances, events, outcomes and other matters that Argent budgets, forecasts, plans, projects, estimates, expects, believes, assumes or anticipates (and other similar expressions) will, should or may occur in the future are considered forward-looking information.  In particular, forward-looking information contained in this press release include, but are not limited to, Argent's status as a mutal fund trust, information and statements concerning the Acquired Assets and the performance and production characteristics of the Acquired Assets. In addition, statements relating to "reserves" are by their nature forward-looking information, as they involve the implied assessment, based on certain estimates and assumptions that the reserves described can be profitably produced in the future. The recovery and reserve estimates of the Trust's reserves provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered. The forward-looking information provided in this press release is based on management's current beliefs, expectations and assumptions, based on currently available information as to the outcome and timing of future events.  Argent cautions that its future oil, natural gas and natural gas liquids production, revenues, cash flows, liquidity, plans for future operations, expenses, outlook for oil and natural gas prices, timing and amount of future capital expenditures, and other forward-looking information is subject to all of the risks and uncertainties normally incident to the exploration for and development and production and sale of oil and gas.

These risks include, but are not limited to, oil and natural gas price volatility, Argent's access to cash flows and other sources of liquidity to fund its capital expenditures, its level of indebtedness, its ability to replace production, the impact of the current financial climate on Argent's anticipated business and financial condition, a lack of availability of or increases in costs in goods and services, environmental risks, drilling and other operating risks, regulatory changes, the uncertainty inherent in estimating future oil and gas production or reserves, economic conditions and other risks as described in documents and reports that Argent files with the securities commissions or similar authorities in applicable Canadian jurisdictions on the System for Electronic Document Analysis and Retrieval (SEDAR).  Any of these factors could cause Argent's actual results and plans to differ materially from those contained in the forward-looking information.

Forward-looking information is subject to a number of risks and uncertainties, including those mentioned above, that could cause actual results to differ materially from the expectations set forth in the forward-looking information.  Forward-looking information is not a guarantee of future performance or an assurance that our current assumptions and projections are valid.  All forward-looking information speaks only as of the date of this press release, and Argent assumes no obligation to, and expressly disclaims any obligation to, update or revise any forward-looking information, except as required by law.  You should not place undue reliance on forward-looking information.  You are encouraged to closely consider the additional disclosures and risk factors contained in Argent's filings on SEDAR that discuss in further detail the factors that could cause future results to be different than contemplated in this presentation.

The reserves data set forth herein is based upon an evaluation by Sproule Associates Limited ("Sproule") dated effective December 31, 2011, using Sproule's December 31, 2011 forecast prices and costs.  Reserve Life Index, as referenced herein, is calculated by dividing the applicable total proved or total proved plus probable reserves by current working interest before royalty production.

Barrels of oil equivalent (boe) may be misleading, particularly if used in isolation.  A boe conversion ratio of six Mcf to one bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and do not represent a value equivalency at the wellhead.  Given that the value ratio based on the current price of oil as compared to natural gas is significantly different from the energy equivalency conversion ratio of six to one, utilizing a boe conversion ratio of six Mcf to one bbl may be misleading as an indication of value.

SOURCE: Argent Energy Trust

concerning this press release, please contact: 

Brian Prokop
Chief Executive Officer
Argent Energy Trust
[phone]

Sean Bovingdon
Chief Financial Officer
Argent Energy Trust
[phone]