Cirrus Energy Corporation - Repayment of Borrowing Base Facility

CALGARY, Sept. 8 /CNW/ -- CALGARY, Sept. 8 /CNW/ - Cirrus Energy Corporation (TSXV: CYR) and its wholly owned subsidiary Cirrus Energy Nederland B.V. have elected to repay the outstanding balance, totalling C$15.7 million, of its borrowing base facility with The Royal Bank of Scotland plc ("RBS") and cancel the facility. The early repayment and cancellation of the borrowing base facility is expected to save Cirrus approximately C$1.0 million in financing charges over the next fifteen months. The borrowing base facility repayment will be made from Cirrus' restricted and unrestricted cash balances of approximately C$43.8 million.
The Company is currently well positioned from a financial resource perspective with current working capital of approximately C$25.5 million (net of debt to be repaid). Our strong balance sheet combined with current operating cashflow of approximately C$2.0 million per month provides Cirrus with the flexibility to react immediately to opportunities in The Netherlands, the UK and potentially other international locations.
Cirrus' President, David Taylor, comments: "The current borrowing base facility was established to finance the completion of the M07-A development project and to finance the modification work on the L11b-A platform that was required to tie-in the L11b-A06 development well. With these projects now completed and providing material cashflow, we have determined that there is no further benefit in maintaining the facility."

Cirrus Energy Corporation is an international oil and gas company headquartered in Calgary and has approximately 92.0 million fully diluted common shares outstanding. Additional information about Cirrus and its business activities is available at www.cirrusenergy.ca and www.sedar.com.

Forward-Looking Statements

This press release may include forward-looking statements including opinions, assumptions, estimates and expectations of future production, cash flow and earnings. When used in this document, the words "anticipate", "believe", "estimate", "expect", "intent", "may", "project", "plan", "should" and similar expressions are intended to be among the statements that identify forward-looking statements. Forward-looking statements are subject to a wide range of risks and uncertainties, and although the Company believes that the expectations represented by such forward-looking statements are reasonable there can be no assurance that such expectations will be realized. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements including, but not limited to, the volatility of oil and gas prices, the ability to implement corporate strategies, the state of domestic capital markets, the ability to obtain financing, changes in oil and gas acquisition and drilling programs, operating risks, production rates, reserve estimates, changes in general economic conditions and other factors more fully described from time to time in the reports and filings made by Cirrus with securities regulatory authorities.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

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David Taylor, President and Chief Executive Officer, John Bell, Chief Financial Officer, Cirrus Energy Corporation, Suite 208, 5 Richard Way, S.W., Calgary, Alberta, T3E 7M8, Canada, Website: www.cirrusenergy.ca, Telephone: [phone], Facsimile: [phone]

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