Reece Energy Exploration Corp. announced that it has increased its capital budget for 2008 by an additional $30 million. This increase is in addition to the $15 million dollar increase announced May of this year bringing the total capital budget for 2008 to $66 million.
In order to partially fund the increased capital expenditures, Reece has entered into an agreement with a syndicate of underwriters led by Wolverton Securities Ltd. and including Evergreen Capital Partners Inc. and CIBC Capital Markets to raise up to up to $20 million with provision for an overallotment of up to $3 million through the issuance of common shares of the Company at a price to be determined in the context of the market.
This increase has been approved as a result of the Company's drilling success, increased land and opportunity generation and the exceptional oil and gas pricing environment. The new capital will be used to fund an expanded drilling program, ongoing capital program and for general corporate purposes. The increased expenditures will be funded from existing internal sources as well as the Financing.
All sales will be made on a private placement basis pursuant to exemptions from the prospectus requirements of applicable securities laws. The closing of the offering is expected to occur on or about August 22, 2008 and is subject to certain conditions including, but not limited to, receipt of all necessary regulatory approvals including the approval of the TSX Venture Exchange. The Common Shares will be subject to a four month hold from the date of the closing.
Reece is a growth oriented junior oil and gas company focused on creating shareholder value by growing per share production and reserves through acquisitions and a focused exploration and development plan. Reece's core producing oil and gas assets are located in Saskatchewan. Reece has a prospective Bakken land position which it has already begun to develop.
Reece has approximately 32,500,000 Class A common shares outstanding before this financing.
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