Torrent Energy Corporation has retained investment banking firm Gordian Group, LLC to assist the Company in raising additional capital and reviewing potential strategic business alternatives. Torrent is seeking to raise $10 million to $15 million in debt financing to fund the next phase of its coal-bed methane project in Oregon's Coos Bay Basin.
John Carlson, president and CEO, said, "Concurrent with our work to establish commercial production in Coos Bay has been a concerted effort to secure new sources of capital, which is necessary to fund a fracing program and other pre-production operations on our Westport project wells. In recent months we have pursued a number of prospective joint-venture opportunities, and have engaged in detailed negotiations with our current and largest financial sponsor, YA Global Investments, L.P. (formerly Cornell Capital). To date we have been unable to conclude a new financing agreement that management and our board of directors believe is in the best long-term interest of the Company and our shareholders. We are optimistic that New York City-based Gordian Group will expose us to a broader range of financing options and partnership opportunities."
Torrent has been unable to meet various obligations called for in the Investment Agreement that the Company entered into with YA Global on June 28, 2006. Details regarding the original agreement and a default notification that Torrent has received from YA Global regarding recent delinquencies are addressed in a Form 8-K filed today by Torrent with the Securities and Exchange Commission. The Company will examine all options, and plans to continue its discussions with YA Global. However, if additional financing is not obtained, the Company expects exploration plans and future operations will be suspended and Torrent may sell non-critical assets.
"We have taken aggressive steps to reduce overhead expenses in recent months, and have been judicious in our efforts to preserve capital," Carlson said. "We remain confident in the strength of our asset portfolio and look forward to working both with Gordian Group and prospective joint-venture partners to establish potential funding or strategic alternatives that will allow us to leverage these assets for the benefit of all our shareholders."
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