Petrobakken Increases Senior Notes Offering to $900M

PetroBakken Energy Ltd. has increased the size of its previously announced private placement offering of senior unsecured notes (the "Notes") by $150 million to $900 million in aggregate principal amount (the "Notes Offering"), resulting in net proceeds to the Company of approximately $875 million after deduction of original issue and initial purchaser discounts and estimated offering expenses. The Notes will bear interest at a rate of 8.625 percent per annum and are due in 2020. The Company expects settlement of the Notes Offering on January 30, 2012, subject to the satisfaction of customary closing conditions.

Upon completion of the Notes Offering, PetroBakken will have significantly improved our balance sheet and liquidity position. Proceeds from the Notes Offering will be used to repurchase $450 million of convertible debentures, with the remainder used to repay a portion of our secured credit facility. Following the completion of the Notes Offering and the recently announced asset sale, we expect to have approximately $675 million drawn on our credit facility, which is anticipated to be increased to $1.5 billion upon closing of the Notes Offering.

The Notes offered have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws and, unless so registered, may not be offered or sold in the United States or to U.S. persons except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. The senior unsecured notes will be offered only to qualified institutional buyers under Rule 144A under the Securities Act and outside the United States to non-U.S. persons under Regulation S. In Canada, the Notes will be offered and sold on a private placement basis in certain provinces to certain accredited investors.


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