8 March 2005
EastCoast Energy announces oversubscription of rights issue
TORTOLA, British Virgin Islands. -- EastCoast Energy Corporation ("EastCoast Energy" or the "Company") announces that its rights issue which closed March 4, 2005 was oversubscribed and that gross proceeds of Cdn$5.5 million have been raised for the Company.
The funds will be used primarily to develop the Company's existing gas assets in Tanzania and to pursue new options for growth. In 2005, the Company will reprocess 400 kilometres of existing seismic and is likely to undertake a minimum $2.1 million seismic programme over the Songo Songo field and adjacent exploration acreage.
Under the terms of the rights issue
- each holder of a Class B Subordinated Voting share ("Class B Share") was entitled to receive one right for each Class B Share held and ten rights entitled the holder to subscribe for one Class B Share at a price of Cdn$ 2.60.
- each holder of a Class A Common share ("Class A Share") was entitled to receive one right for each Class A Share held and ten rights entitled the holder to subscribe for one Class B Share at a price of Cdn$ 2.60.
- each holder of rights who exercised all of their rights was entitled to subscribe for additional Class B Shares that had not been subscribed and paid for at 12:00 noon on 4 March 2005 ("Additional Subscription Privilege")
The subscription price of Cdn$ 2.60 represented a 15% discount to the closing price of the Class B Shares on 19 November, 2004.
As at 17:00 hours on 4 March 2005, 2,052,542 Class B Shares had been subscribed for by the rights holders and 6,318,198 Class B Shares had been subscribed for in the Additional Subscription Privilege.
As a result of the rights issue, the Company will issue 2,113,744 Class B Shares including 61,202 Class B Shares under the Additional Subscription Privilege. This will increase the number of Class B Shares in issue to 21,499,988. The number of outstanding Class A Shares remains the same at 1,751,195.
EastCoast Energy Corporation Limited is a TSXV listed company focused on the production of Tanzanian natural gas and the sale of "Additional Gas" to markets in East Africa. The Company was spun out from PanOcean Energy Corporation and began trading on the TSXV as a separate public company on 31 August 2004 under the trading symbols ECE.SV.B and ECE.MV.A. The company is headquartered in Tortola, British Virgin Islands and maintains its operations offices in Dar es Salaam, Tanzania.
Forward Looking Statements
This disclosure contains certain forward-looking estimates that involve substantial known and unknown risks and uncertainties, certain of which are beyond EastCoast's control, including the impact of general economic conditions in the areas in which EastCoast operates, civil unrest, industry conditions, changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in commodity prices, foreign exchange or interest rates, stock market volatility and obtaining required approvals of regulatory authorities. In addition there are risks and uncertainties associated with oil and gas operations, therefore EastCoast's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking estimates and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking estimates will transpire or occur, or if any of them do so, what benefits, including the amounts of proceeds, that EastCoast will derive therefrom.
For further information please contact:
Peter R. Clutterbuck, CEO
+44 (0) 7768 120727
Nigel A Friend, CFO
+255 (0)22 2138737