NEWS BULLETIN

December 27, 2010 --- Vol. 16, No. 121December 2010

TG World to be acquired by Canadian mining company

A Calgary mining company is acquiring an Alaska North Slope oil explorer.

TG World Energy Inc. announced on Dec. 23 that it was being acquired by TVI Pacific Inc. TG World is a Calgary-based independent that has been exploring the North Slope as part of a multi-company joint venture led by Brooks Range Petroleum Corp. TVI Pacific is a Calgary-based mining company that shares a senior executive with TG World.

Through the acquisition, TVI would get all TG World common shares on the basis of two-thirds of a TVI common share for each TG common share. TVI would also buy 29.65 million TG common shares and invest more than $1.3 million in TG World through a convertible promissory note to help TG World “in financing its immediate obligations.”

TVI estimates the total value of the transaction at $13.5 million.

Once the transaction is completed, TVI shareholders would hold 84.4 percent of the merged company, while TG World shareholders would hold the remaining 15.6 percent.

TG World is holding a special shareholders meeting in late February to vote on the deal.

While the transaction includes Alaska assets, it’s not based around those assets.

TVI is a Calgary-based mining company focused on the Philippines. Last March, TG World added a Philippine oil prospect to a portfolio that also includes prospects in Niger and on Alaska’s North Slope. TG World has been updating its investors on the progress of its Philippines project almost weekly since getting successful flow test results in June.

The two companies, in a joint press release, said the deal would “allow TVI to leverage its extensive relationships in the Philippines by entering the Philippine oil and gas sector. This could provide TVI with access to a second cash flow stream that would help to offset TVI’s exposure to base and precious metals commodity pricing risk.”

In a prepared statement, TVI President and CEO Clifford James said, “TVI has a strategic need for an acquisition to expand its cash flow sources, but high commodity prices are making advanced acquisitions in the Philippines mining sector difficult to secure. This opportunity will also allow TVI to build scale and scope through an investment in an additional resource that is expected to help mitigate the risks associated with a single commodity.” James is also the president and CEO of TG World Energy.

The deal would also benefit TG World, according to a prepared statement from Chairman Wayne Thomson, who said “the Transaction will merge anticipated cash flow from the offshore Philippines wells (and possibly North Tarn, Alaska) with a corporation that will have the financial and technical capacity to move TG’s oil and gas projects forward.”

See more in Jan. 2 issue of Petroleum News, available to subscribers online by 11 a.m., Thursday, Dec. 30


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