ABERDEENSHIRE, UK--(Marketwire - April 28, 2009) - THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE UNITED STATES
Xcite Energy (TSX-V: XEL) (LSE: XEL) (AIM: XEL), the developer of heavy oil assets in the UK North Sea, is pleased to report:
2009 Budget -- heavy oil Field Allowance -- tax reduction of GBP 160 million
In connection with the 2009 HM Treasury Budget statement on April 22, Xcite Energy reports that the Bentley field in Block 9/3b in the UK North Sea falls within the scope of the new Field Allowance to support investment in heavy oil projects.
The Field Allowance, based on 100% ownership of the field, will reduce the corporation tax (supplementary) charge applicable to the Bentley field by GBP160 million, which would increase the net present value of the field as presented in the Base Case in the recent Competent Person's Report by more than US$100 million.
Appointment of Divestment Advisor
Xcite Energy has appointed Stellar Energy Advisors ("Stellar") to manage the partial divestment process to help fund the next intervention on the Bentley field, planned for 2010. Stellar is a leading independent portfolio management consultancy for the upstream international oil and gas community, with significant heavy oil experience.
Richard Smith, Xcite Energy Chief Executive Officer, commented:
"We welcome the introduction of this Field Allowance for heavy oil fields and the positive effect that it will have on the already robust economics of the Bentley field. The GBP 160 million increase in retained value that will accrue to the field will provide added benefit to industry and financial partners seeking significant value uplift and, in this context, the divestment of part of the Bentley field is well timed. We are very pleased to have the expertise and assistance of Stellar in this transaction and we look forward to a successful outcome."
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Certain statements contained in this announcement constitute forward-looking information within the meaning of securities laws. Forward-looking information may relate to the Company's future outlook and anticipated events or results and, in some cases, can be identified by terminology such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "intend," "estimate," "predict," "target," "potential," "continue" or other similar expressions concerning matters that are not historical facts. These statements are based on certain factors and assumptions including expected growth, results of operations, performance and business prospects and opportunities. While the Company considers these assumptions to be reasonable based on information currently available to us, they may prove to be incorrect. Forward-looking information is also subject to certain factors, including risks and uncertainties that could cause actual results to differ materially from what we currently expect. These factors include changes in market and competition, governmental or regulatory developments and general economic conditions. Additional information identifying risks and uncertainties are contained in the Company's annual information form dated June 30, 2008 filed with the Canadian securities regulatory authorities, available at www.sedar.com. The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required under applicable securities regulations.
FOR FURTHER INFORMATION PLEASE CONTACT:
Xcite Energy Limited
Chief Executive Officer
Chief Financial Officer
+44 (0) 1330 826 740
Thomas Weisel Partners International Limited
+44 (0) 20 7877 4300
Strand Partners Limited
+44 (0) 20 7409 3494
Pelham Public Relations
+44 (0) 20 7337 1500