Bengal Energy Announces Closing of $8.0 Million Private Placement

CALGARY, July 5, 2013 /CNW/ - Bengal Energy (TSX: BNG) ("Bengal", or the "Company") is pleased to announce the closing of its previously announced non-brokered private placement of 8,000 units ("Units") of the Company at a price of $1,000 per Unit for aggregate gross proceeds of $8.0 million (the "Private Placement").  The proceeds from the Private Placement will be used to fund the Company's previously announced purchase of an additional 5.357% interest in its key property, Cuisinier, located in the Cooper-Eromanga Basin in Queensland, Australia (the "Acquisition").  Following closing of the Acquisition, Bengal's net production participation will increase by more than 20%.

Each Unit consists of $1,000 principal amount of 10% unsecured non-convertible redeemable notes ("Notes") and either: (i) 156.25 common share purchase warrants ("Warrants"), in the case of subscriptions by non-insiders, or (ii) 156.25 value appreciation rights ("VARs"), in the case of subscriptions by insiders.  The Notes bear interest at a rate of 10% per annum, payable quarterly, and have a term of 36 months. Following the first anniversary of the closing date (the "Closing Date") of the Private Placement, the Company shall be required to make quarterly repayments of the outstanding principal of Notes in an amount equal to 6.25% of the principal amount of Notes outstanding on the last day of each applicable quarter.  Each whole Warrant entitles the holder thereof, for a period of 36 months following the Closing Date, to acquire one common share (a "Common Share") in the capital of the Company at a purchase price equal to $0.75 per share.  Each whole VAR entitles the holder thereof, for a period of 36 months following the Closing Date, to exercise the VAR and thereby receive a cash payment equal to the difference between the market price of one Common Share on the exercise date and $0.75.  Certain insiders of the Company purchased 3,500 Units representing over 40% of the total Units issued, and 4,500 Units were purchased by non-insiders.

This press release does not constitute an offer of the Notes, Warrants (or the Common Shares issuable on the exercise thereof) or the VARs (collectively, the "Securities") for sale in the United States or in any jurisdiction in which such offer or sale would be unlawful.  The Securities have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States absent registration or an exemption from registration under that Act.

The Securities issued are subject to a four-month hold period, which expires on November 6, 2013.

About Bengal
Bengal Energy Ltd. is an international junior oil and gas exploration and production company based in Calgary, Alberta. The Company is committed to growing shareholder value through international exploration, production and acquisitions. Bengal trades on the TSX under the symbol BNG. Additional information is available at www.bengalenergy.ca.

This news release contains certain forward-looking statements or information ("forward-looking statements") as defined by applicable securities laws that involve substantial known and unknown risks and uncertainties, many of which are beyond Bengal's control.  These forward-looking statements relate to future events or our future performance.  All statements other than statements of historical fact may be forward-looking statements.  The use of any of the words "plan", "expect", "prospective", "project", "intend", "believe", "should", "anticipate", "estimate", or other similar words or statements that certain events "may" or "will" occur are intended to identify forward-looking statements.  The projections, estimates and beliefs contained in such forward-looking statements are based on management's estimates, opinions, and assumptions at the time the statements were made, including, without limitation, assumptions relating to: the impact of economic conditions in North America, Australia, India and globally; industry conditions; changes in laws and regulations including, without limitation, the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced;  increased competition; the availability of qualified operating or management personnel; fluctuations in commodity prices, foreign exchange or interest rates; stock market volatility and fluctuations in market valuations of companies with respect to announced transactions and the final valuations thereof; and the ability to obtain required approvals and extensions from regulatory authorities.  We believe the expectations reflected in those forward-looking statements are reasonable but, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that Bengal will derive from them.  As such, undue reliance should not be placed on forward-looking statements.  Forward-looking statements contained herein include, but are not limited to, statements regarding: the use of proceeds from the Private Placement; completion of the Acquisition; and the benefits of the Acquisition.  The forward-looking statements contained herein are subject to numerous known and unknown risks and uncertainties that may cause Bengal's actual financial results, performance or achievement in future periods to differ materially from those expressed in, or implied by, these forward-looking statements, including but not limited to, risks associated with: the failure to obtain required safety assessments and rig acceptance; failure to secure required equipment and personnel; changes in general global economic conditions including, without limitations, the economic conditions in North America, Australia, India; increased competition; the availability of qualified operating or management personnel; fluctuations in commodity prices, foreign exchange or interest rates; changes in laws and regulations including, without limitation, the adoption of new environmental and tax laws and regulations and changes in how they are interpreted and enforced; the results of exploration and development drilling and related activities; the ability to access sufficient capital from internal and external sources; failure to obtain or delays in obtaining regulatory approvals; delays or changes in planned operations; operational risks associated with exploration, development and production; the results of geological, geophysical and reservoir analysis; results of drilling and seismic activities; results of due diligence investigations; and stock market volatility.  Readers are encouraged to review the material risks discussed in Bengal's Annual Information Form under the heading "Risk Factors" and in Bengal's annual MD&A under the heading "Risk Factors".  The Company cautions that the foregoing list of assumptions, risks and uncertainties is not exhaustive.  The forward-looking statements contained in this news release speak only as of the date hereof and Bengal does not assume any obligation to publicly update or revise them to reflect new events or circumstances, except as may be require pursuant to applicable securities laws.

SOURCE Bengal Energy Ltd.




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