TG World Energy Corp. announced today that management and the directors of the Company believe it is well positioned, over the foreseeable future, to weather the current economic turmoil that has adversely affected a number of resource industry participants. As at November 26, 2008, TG World had approximately CAD$14.7 million in its treasury. In addition, the Company has applied, or is in the process of applying, to authorities in the State of Alaska for reimbursement of approximately CAD$10.2 million from the State of Alaska’s Oil and Gas Petroleum Production Tax incentive program.
Due in large part to the uncertainty created by the world financial crisis and the drop in oil prices, but also pending further analysis of the well data, seismic results and preliminary engineering studies in the area, the Company has decided to postpone its participation in the drilling and development programs previously planned for the 2009 exploration season in the Gwydyr area (TG World interest 35%). Discussions are ongoing with the operator, Brooks Range Petroleum Corp., and the other Alaska Joint Venture Participants with respect to the nature and extent of the 2008/2009 Alaska winter program. The Company has agreed to participate in the seismic acquisition program planned for the South Thomson area (TG World interest 25%) and continue to participate in the ongoing processing and interpretation of seismic data acquired last season in the greater Tofkat area (TG World interest 25%), with a view to identifying possible drilling prospects for the 2009/2010 winter drilling program. Final seismic results are not expected to be available until the end of 2008. The postponement of drilling and development activities is expected to substantially reduce TG World’s near-term capital expenditures.
In addition, TG World has initiated a strategic review of other opportunities that may be available to the Company, including oil and gas opportunities in Western Canada, and elsewhere.
The Company’s exploration program in the Republic of Niger remains on hold pending the alleviation of local security concerns.
At a meeting of the Board of Directors held on Tuesday, November 25, 2008, the directors authorized the implementation of a normal course issuer bid by the Company, and instructed management to make the necessary filings with regulatory authorities to permit the Company to repurchase (over a 12 month period) up to 6,116,376 common shares, representing 5% of the 122,327,538 common shares of the Company currently outstanding, under such a bid. The Company has not previously purchased any of its outstanding shares under a normal course issuer bid and has not yet appointed a brokerage firm for purposes of the proposed bid.
The directors have also authorized the implementation of a shareholders' rights plan for the Company and have instructed management to prepare a form of shareholders' rights plan for consideration by the Board and make application for all regulatory approvals required to permit the implementation of such a plan.
Implementation of a normal course issuer bid and a shareholders' rights plan by the Company is subject to the receipt of all necessary regulatory approvals, including the approval of the TSX Venture Exchange.