Penn West Energy Trust announced that the proposed plan of arrangement between Penn West Energy Trust and Vault Energy Trust and the proposed plan of arrangement between Penn West Energy Trust and Canetic Resources Trust have each been determined by the Canadian Minister of Industry to be of net benefit to Canada.
In order to demonstrate to the Minister of Industry that the Penn West-Vault Transaction and the Penn West-Canetic Transaction will be of net benefit to Canada, Penn West made certain commitments to the Minister of Industry. These commitments included undertakings to expend significant capital towards the development of the Vault and Canetic properties and businesses; maintaining its head offices in Calgary, Alberta and continuing to carry out its head office functions in Canada; maintaining certain aggregate employment levels and utilizing its expertise in, and ability to fund, unconventional resource exploitation and development through a focused evaluation of potential large scale, multi-year projects and other opportunities for the exploitation, development and optimization of Vault's and Canetic's unconventional resource properties. Penn West's 2008 capital expenditure program will approximate $900 million.
Following the closing of the Penn West-Vault and the Penn West-Canetic Transactions, Penn West will be positioned to create long-term value for Penn West unitholders and former Vault Energy Trust and Canetic Resources Trust unitholders through a high-quality, long-life asset base, a strong balance sheet and an extensive drilling inventory, as well as improved access to equity and debt markets resulting from Penn West's increased size.
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