Monday May 10, 12:48 pm Eastern Time
Company Press Release
SOURCE: Tracer Petroleum Corporation
Tracer Update on Indonesian Producing
Property
CALGARY, Alberta, May 10 /PRNewswire/ -- Tracer Petroleum Corporation (Nasdaq: TCXXF -
news; Vancouver: TPC - news; ''Tracer'' or the ''Company'') reports that in respect of the
announcement of December 9, 1998 regarding an assignment agreement for a minimum 80%
interest and operatorship of the Sungai Gelam A, B, and D Technical Assistance Contract
(''TAC'') in Sumatra, Indonesia, Tracer is pleased to report that certain conditions expected
to be met earlier by the vendor are now approaching resolution after support of the
commercial section of the Canadian Embassy in Jakarta.
The most significant of these conditions involved restructuring the vendor's outstanding loan
having a lien against the working interest of the property and was subject to much delay from
negotiations necessary with the operators' creditors. At the bank's request, a meeting was held
in Tracer's Indonesian office yesterday to discuss arrangements necessary for the vendor to
assign proposed benefits of his portion of the agreement to the bank.
Final legal and financial due diligence are expected to start upon signature of all parties to the
beneficial assignment. Upon final government approval of Tracer as operator of the TAC and
other necessary approvals for the rig move, the Tracer Kremco 600 drilling and workover rig
is expected to be mobilized from Kalimantan to Sumatra. Application for extension of duty-free
rig import license has already been submitted for Pertamina and customs approvals.
A separate rights offering to shareholders is expected to provide necessary initial funding, subject to securities regulatory approval, and upon shareholder approval of resolutions described in the Circular and Proxy sent to shareholders May 4, 1999.
This release contains ''forward looking statements'' as per Section 21E of the US Securities
and Exchange Act of 1934, as amended. Although the Company believes that the expectations
reflected in such forward looking statements are reasonable, it can give no assurance that such
expectations will prove to have been correct. Management is currently reviewing many options
and there is no assurance that they will not make decisions other than those now
contemplated. The Company is subject to political risks; and operational risks identified in
documents filed with the Securities and Exchange Commission, including changing and
depressed oil prices, unsuccessful drilling results, change of government and political unrest in
its main area of operations.
NOTE: The Vancouver Stock Exchange has neither approved nor disapproved the content of
this release.
For more information please contact Mr. David Harrison, Corporate Secretary, at
403-290-1676 at the Company's headquarters.
SOURCE: Tracer Petroleum Corporation
Jim
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