Gulfport Energy Corporation Announces Sale of Common Stock, Redemption of Outstanding Preferred Stock, Exercise of Warrants for
February 25 2005 - 12:34PM
PR Newswire (US)
Gulfport Energy Corporation Announces Sale of Common Stock,
Redemption of Outstanding Preferred Stock, Exercise of Warrants for
Common Stock and 2005 Exploration and Development Plans OKLAHOMA
CITY, Feb. 25 /PRNewswire-FirstCall/ -- Gulfport Energy Corporation
(OTC:GPOR) (BULLETIN BOARD: GPOR) , in two separate transactions
with accredited investors completed on February 18, 2005 and
February 23, 2005, respectively, sold an aggregate of 4,000,000
shares of its common stock, par value $0.01 per share, at a price
of $3.50 per share for gross proceeds to the Company of $14.0
million. The purchasers in one transaction were Southpoint Capital
Fund LP, Southpoint Qualified Fund LP and Southpoint Offshore
Operating Fund LP. The purchasers in the other transaction were
Harbert Distressed Investment Master Fund, Ltd. and Alpha U.S. Sub
Fund VI, LLC. Separately, on February 23, 2005, holders of a
majority of the warrants issued by the Company in its 2002
preferred stock offering elected to exercise their warrants for
shares of Gulfport's common stock. As a result, the Company issued
approximately 7,336,687 shares of common stock to these warrant
holders in exchange for cash proceeds of approximately $8.7
million. On February 23, 2005, the Company used these proceeds,
along with a portion of the proceeds from the sale of common stock,
to redeem 12,502 shares of the 14,271 shares of the Company's
outstanding Series A preferred stock for an aggregate of $12.5
million including accrued but unpaid dividends. After the sale of
common stock, exercise of the warrants and redemption of preferred
stock, Gulfport received net proceeds of $10.2 million. We intend
to use these net proceeds, together with cash-on-hand of
approximately $5.0 million and cash from operations, to redeem, all
or in part, the remaining outstanding shares of preferred stock, to
execute the Company's 2005 drilling program and explore acquisition
opportunities. The Company is also negotiating a $30.0 million
credit facility ($18.0 initial availability) which, if consummated,
will enhance Gulfport's ability to accelerate and expand drilling
operations and more aggressively seek out other investment
opportunities. Gulfport plans to commence its 2005 drilling program
at the West Cote Blanche Bay Field in St. Mary Parish, Louisiana in
March of 2005. Gulfport has budgeted approximately $25.0 million to
drill approximately 20 to 25 wells. The wells to be drilled were
previously identified by the Company's reserve engineers as proved
undeveloped reserve locations but Gulfport will also explore for
possible and probable reservoirs by going deeper and directionally
guiding the bit for untapped fault blocks. Gulfport's other primary
asset is the East Hackberry Field located in Cameron Parish,
Louisiana. The Company has completed seismic permitting and
received final regulatory approval for a forty-two square mile,
three dimensional (3-D) seismic survey with an estimated cost of
approximately $4,500,000. Gulfport began the seismic data
acquisition during the fourth quarter of 2004 and hopes to have the
final processed seismic data during the third quarter 2005. Since
this portion of the Hackberry dome has never been included in a 3-D
seismic survey, the Company believes the shoot will reveal
undrilled fault blocks that will allow Gulfport to drill new wells
to both shallow and deep targets in the field. The drilling
programs in Hackberry should commence by September of 2005. Mike
Liddell, Gulfport's Chief Executive Officer, commented, "Gulfport
plans to capitalize on rising commodity prices by aggressive
drilling programs in both its West Cote Blanche Bay and East
Hackberry fields to both exploit the Company's proved undeveloped
prospect inventory and find and develop new previously unidentified
reserves. Gulfport is in the fortunate position of being prospect
rich in a prospect poor market. We will also continue our
production enhancement operations in our WCBB field. This should
allow us to increase our production profiles for 2005." Gulfport is
an independent oil and gas exploration and production company with
its principal properties located in the Louisiana Gulf Coast area.
The Company seeks to achieve reserve growth and increased cash flow
from operations through low risk development activities on its
existing properties. This news release includes "forward-looking
statements" within the meaning of Section 27A of the Securities Act
of 1933, as amended (the "Securities Act"), and Section 21E of the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
All statements other than statements of historical facts, included
in this news release that address activities, events or
developments that Gulfport Energy Corporation ("Gulfport" or the
"Company"), a Delaware corporation, expects or anticipates will or
may occur in the future, including such things as future capital
expenditures (including the amount and nature thereof), business
strategy and measures to implement strategy, competitive strength,
goals, expansion and growth of Gulfport's business and operations,
plans, references to future success, reference to intentions as to
future matters and other such matters are forward-looking
statements. These statements are based on certain assumptions and
analyses made by Gulfport in light of its experience and its
perception of historical trends, current conditions and expected
future developments as well as other factors it believes are
appropriate in the circumstances. However, whether actual results
and developments will conform with Gulfport's expectations and
predictions is subject to a number of risks and uncertainties,
general economic, market, or business conditions; the opportunities
(or lack thereof) that may be presented to and pursued by Gulfport;
competitive actions by other oil and gas companies; changes in laws
or regulations; and other factors, many of which are beyond the
control of Gulfport. Consequently, all of the forward-looking
statements made in this news release are qualified by these
cautionary statements and there can be no assurances that the
actual results or developments anticipated by Gulfport will be
realized, or even if realized, that they will have the expected
consequences to or effects on Gulfport, its business or operations.
We have no intention, and disclaim any obligation, to update or
revise any forward-looking statements, whether as a result of new
information, future results or otherwise. DATASOURCE: Gulfport
Energy Corporation CONTACT: Mike Liddell of Gulfport Energy
Corporation, +1-405-848-8807, ext. 106 Web site:
http://www.gulfportenergy.com/
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