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Harvest Energy Trust, Storm Energy Ltd. and Storm Exploration Inc. Announce Completion of Plan of Arrangement

Jun 30, 2004 - 18:17 ET

CALGARY, ALBERTA--(CCNMatthews - Jun 30, 2004) - 

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR 
DISSEMINATION IN THE UNITED STATES. ANY FAILURE TO COMPLY WITH 
THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF U.S. SECURITIES 
LAW. 

Harvest Energy Trust ("Harvest") (HTE.UN - TSX), Storm Energy 
Ltd. ("Storm") (SEM - TSX) and Storm Exploration Inc 
("ExploreCo") (SEO - TSX) announced today that they have 
completed the previously announced Plan of Arrangement (the 
"Arrangement") whereby Harvest acquired all the outstanding 
shares of Storm for approximately $189 million. Pursuant to the 
Arrangement, Harvest and Storm have combined their assets into 
Harvest and have transferred certain of Storm's assets to 
ExploreCo, a separate junior exploration and production company 
which will be owned by the former Storm shareholders. 

Each Storm shareholder received $4.15 of consideration per Storm 
share from Harvest either in cash, Harvest trust units and 
exchangeable shares or a combination thereof. Additional 
consideration payable to shareholders of Storm is made up of one 
share of ExploreCo or a cash amount of $2.00, and 0.053 of a 
share in Rock Energy Inc. ("Rock") (RE - TSXV) for each Storm 
share. The consideration paid by Harvest consisted of an 
aggregate $75 million in cash, 601,000 exchangeable shares of 
Harvest Operations Corp., exchangeable into an equivalent number 
of Harvest trust units and 2.720 million Harvest trust units. 

As a result of elections made by Storm shareholders each Storm 
shareholder who elected to receive exchangeable shares will 
receive their entire total elected amount in exchangeable shares. 
Each Storm shareholder who elected to receive trust units will 
receive their entire total elected amount in trust units. Lastly, 
each Storm shareholder who elected to receive cash will receive 
79% of their total elected amount in cash and 21% of their total 
elected amount in trust units. 

Each exchangeable share is exchangeable into one Harvest trust 
unit at any time following completion of the Plan of Arrangement 
for no additional consideration. This exchange ratio will 
increase by the amount of monthly distributions made by Harvest 
subsequent to June 30, 2004, including the distribution payable 
on July 15th, 2004. Non-resident and tax exempt shareholders of 
Storm were only eligible to receive trust units or cash from 
Harvest. 

The shareholders of Storm approved the Arrangement at a special 
meeting held on June 28, 2004. 

Benefits to Harvest Unitholders: 

Harvest believes the properties acquired through the Arrangement 
will enhance value for Unitholders by providing the following 
strategic and financial benefits: 

- accretive to Harvest's 2004 cash flow per trust unit; 

- effective June 30, 2004, increase Harvest's production by 
approximately 27% to 19,000 BOE/d; 

- diversify Harvest's production base by adding current 
production of approximately 4,000 BOE/d (1.5 mmcfd, 3,800 bpd) of 
natural gas and light oil production; 

- increase Harvest's proved plus probable reserve base(1) by 42%, 
to approximately 47 million BOE; 

- increase Harvest's reserve weighting to light/medium oil to 
76%, reducing heavy oil weighting to approximately 18%; 

- based on current production, increase Harvest's proved plus 
probable reserve life index from approximately 6 to 6.6; 

- enhance Harvest's netbacks as a result of the average lower 
operating cost of the Storm properties and higher per BOE 
realizations; 

- provide an expanded base of production compatible with 
Harvest's proven operating competencies; and 

- add a new core area for additional low cost growth in the form 
of property enhancement and consolidation of additional interests 
through acquisitions. 

(1) As determined by independent evaluation, effective January 1, 
2004. 

Although the Arrangement is accretive to cash flow per trust 
unit, Harvest currently forecasts that it will maintain its 
monthly distribution at $0.20 per trust unit, subject to the 
approval of Harvest's Board of Directors. Additional cash flow 
derived from the Arrangement will be used to fund Harvest's 
ongoing property enhancement program, acquisition strategy and to 
repay debt. 

2004 Full Year Guidance: 

Combining the incremental production from the properties being 
acquired through the Arrangement for the period from July 1, 2004 
to December 31, 2004 with Harvest's existing base of production, 
Harvest expects average production for 2004 to be between 16,750 
and 17,000 BOE/d, with an estimated exit rate for December 2004 
of between 18,750 and 19,250 BOE/d. 


/T/

Harvest Energy Trust
1900, 330 - 5th Avenue S.W. 
Calgary, AB T2P 0L4
Canada

/T/

ADVISORY: Certain information regarding Harvest Energy Trust and 
Harvest Operations Corp. including management's assessment of 
future plans and operations, may constitute forward-looking 
statements under applicable securities law and necessarily 
involve risks associated with oil and gas exploration, 
production, marketing and transportation such as loss of market, 
volatility of prices, currency fluctuations, imprecision of 
reserve estimates, environmental risks, competition from other 
producers and ability to access sufficient capital from internal 
and external sources; as a consequence, actual results may differ 
materially from those anticipated in the forward-looking 
statements. 



-30-


FOR FURTHER INFORMATION PLEASE CONTACT:

Harvest Energy Trust
Jacob Roorda
President
(403) 265-1178

or

Harvest Energy Trust
David M. Fisher
Vice President, Finance
(403) 265-1178
(403) 265-3490 (FAX)
Email: information@harvestenergy.ca
Website: www.harvestenergy.ca