Argent Energy Trust Reports Asset Sale

CALGARY, May 11, 2015 /CNW/ - Argent Energy Trust ("Argent" or the "Trust") (TSX: AET.UN) announces it has entered into an agreement for the sale of its interests in Kansas and Oklahoma (the "Mid-Continent").

Argent Energy (US) Holdings Inc., a wholly-owned subsidiary of the Trust, has entered into a sale  agreement to sell its interests in the Mid-Continent to a third party for gross proceeds of US$20 million, subject to usual closing adjustments.   Argent's holdings in the sale include interests in approximately 19,500 gross (13,600 net) acres and 88 active oil wells, with average working interest production of approximately 548 boe/d barrels of oil equivalent per day ("boe/d") before royalties during the first quarter of 2015.  The transaction has an effective date of January 1, 2015 and is expected to close on or before June 30, 2015.  Argent's corporate production for 2015 is expected to average approximately 4,500 boe/d after taking account of this sale, compared to the previous forecast of 4,700 boe/d.

This transaction represents the second asset sale by Argent in accordance with its previously announced strategy to manage through the challenging market conditions and maintain financial flexibility. The net proceeds from the sale will be used to pay down amounts drawn on Argent's US$140 million credit facility, which is currently US$108 million drawn.  Upon closing of the Mid-Continent sale and the previously announced sale of its Manvel Field, Argent expects to be approximately US$69 million drawn on its facility, which will be re-determined upon closing. These sales conclude the strategic review sales process and Argent will cease marketing its assets.

Argent believes this sale and the previously announced sale of its Manvel Field, together with the continued focus on reducing operating costs, and reduced general and administrative costs, will put the Trust in position to maintain liquidity in the low commodity price environment and provide a stable base of operations on which to move forward.

This press release contains statements that are forward looking. Investors should read the Note Regarding Forward- Looking Statements at the end of this press release. In this press release, references to "Argent" or the "Trust" include the Trust and its operating subsidiaries.

Note about 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 facts, 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 includes, but is not limited to, oil, natural gas and NGL production rates, average production for 2015, operating costs, the expected closing date of the sale transaction, the Trust's ability to maintain compliance and liquidity, the Trust's ability to pay down amounts drawn under its credit facility, and the ability to reduce operating costs and general and administrative costs.

With respect to forward-looking statements contained in this press release, assumptions have been made regarding, among other things, future oil and natural gas prices, future currency exchange and interest rates, the regulatory framework governing taxes in the US and Canada and the Trust's status as a "mutual fund trust" and not a "SIFT trust", estimates of anticipated production from the Trust's assets, which estimates are based on the proposed drilling and completion program with a success rate that, in turn, is based upon historical drilling and completion success and an evaluation of the particular wells to be drilled and completed, future recoverability of reserves from the assets, future potential and experience and performance of its management team, future capital expenditures and the ability of the Trust to obtain financing on acceptable terms for its capital projects and future acquisitions, and the Trust's capital budget (which is subject to change in light of ongoing results, prevailing economic circumstances, commodity prices and industry conditions and regulations).

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 of goods and services, a lack of performance of its staff or ability to retain experienced personnel, 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 periodic filings on SEDAR that discuss in further detail the factors that could cause future results to be different than contemplated in this press release.

Note regarding barrel of oil equivalency

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.

Argent is a mutual fund trust under the Income Tax Act (Canada) (the "Tax Act").  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 exploration potential, located primarily in the United States.  Material information pertaining to Argent Energy Trust may be found on www.sedar.com or www.argentenergytrust.com

SOURCE Argent Energy Trust

concerning this press release, please contact: Sean Bovingdon, President & CFO, Argent Energy Trust, [phone]; Steve Hicks, Chief Operating Officer, Argent Energy Trust, [phone]