News Column

Sterling Resources Closes US$32 Million Equity Private Placement

July 25, 2014

CALGARY, July 25, 2014 /CNW/ - Sterling Resources Ltd. (TSX-V: SLG) ("Sterling" or the "Company") is pleased to announce the closing of the private placement of 71,579,746 new common shares in the capital of the Company (the "Common Shares") to certain existing shareholders at C$0.482 per Common Share to raise approximately US$32 million (the "Placement").  The Common Shares were issued pursuant to applicable exemptions from prospectus requirements and have a hold period expiring on November 26, 2014 pursuant to applicable securities laws.  No commission fees were payable on the Placement.

The subscribers to the Placement, together with the value of shares subscribed for and the total resultant shareholdings upon completion of the Placement where known, are Waterford Finance & Investment Limited (US$20 million, 16.90 percent), Meridian Capital International Fund (US$3.57 million, 9.99 percent), YF Finance Limited (US$3.57 million, 9.99 percent) and other placees ($5 million).

The proceeds of the Placement are intended to be used towards costs arising in the second half of 2014, including Breagh development capital expenditures (principally the drilling of development well A08), the UK Crosgan appraisal well, interest and amortization payments under the Company's US$225 million senior secured bond, further gas price hedging and other corporate costs.  With this funding, the Company expects to be fully financed until late in 2014.  Several of the Company's existing large shareholders have indicated a strong desire to support the Company with additional funding if required, but the Company will continue to explore further funding options, including the debt capital markets, which would minimize further dilution of net asset value to shareholders.

Sterling is a Canadian-listed international oil and gas company headquartered in Calgary, Alberta with assets in the United Kingdom, Romania, France and the Netherlands. The Common Shares are listed and posted for trading on the TSX-V under the symbol "SLG".

Neither the TSX-V nor its Regulation Services Provider (as that term is defined in the policies of the TSX-V) accepts responsibility for the adequacy or accuracy of this release.

Filer Profile No. 00002072           

Forward-Looking Statements

All statements included in this news release that address activities, events or developments that Sterling expects, believes or anticipates will or may occur in the future are forward-looking statements.  In addition, statements relating to expected production, reserves or resources are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves and resources described can be profitably produced in the future.  In particular, this document contains forward-looking statements regarding the use of proceeds of the Placement, expectations for the Company's financial needs, the support of the Company's existing shareholders and the potential to access the debt capital markets.    

These forward-looking statements involve numerous assumptions made by Sterling based on its experience, perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances.  In addition, these statements involve substantial known and unknown risks and uncertainties that contribute to the possibility that the predictions, forecasts, projections and other-forward looking statements will prove inaccurate, certain of which are beyond Sterling's control, including: the impact of general economic conditions in the areas in which Sterling 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.  Readers should also carefully consider the matters discussed under the heading "Risk Factors" in the Company's Annual Information Form.

Undue reliance should not be placed on these forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur.  Sterling's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements.  These statements speak only as of the date of the news release. Sterling does not intend and does not assume any obligation to update these forward-looking statements except as required by law.

Financial outlook information contained in this news release about prospective results of operations, financial position or cash flows is based on assumptions about future events, including economic conditions and proposed courses of action, based on management's assessment of the relevant information currently available.  Readers are cautioned that such financial outlook information contained in this news release should not be used for purposes other than for which it is disclosed herein.

SOURCE Sterling Resources Ltd.


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