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True Energy Trust Announces New Strategic Direction, Asset Divestiture Program, Increased 2008 Capital Program, Confirms January Distribution & Sets a New Distribution Level

View All News Releases December 17, 2007


    CALGARY, Dec. 17 /CNW/ - True Energy Trust ("True" or the "Trust")
announces a new strategic direction and increased 2008 capital program. As
part of this strategy True plans to divest of its oil and natural gas assets
in Saskatchewan and set a new distribution level.

    New Strategic Direction

    Through the divestiture of its Saskatchewan assets, True is taking steps
which will significantly improve its balance sheet. The transaction, once
completed, will provide the financial strength needed to implement an expanded
capital program in 2008 and beyond. The new strategic direction will ensure an
appropriate balance between cash flow, distributions to unitholders, capital
expenditures and debt levels.
    True believes the current environment is an excellent time to launch this
initiative given the:-  repeatability of True's drilling programs;
    -  potential for substantial improvement in True's cost structure and
       operating netbacks;
    -  opportunities for expansion in West Central and Northern Alberta;
    -  expected longer term strengthening of natural gas prices; and
    -  ability for True to move forward with increased financial flexibility
       and be positioned to consider value adding acquisitions.True believes that potential proceeds from the disposition of its
Saskatchewan assets, at a time of historically high oil prices, will be
sufficient to eliminate current bank indebtedness and provide the Trust with
the ability to move forward with increased financial flexibility. With the
increased financial strength, True would be positioned to consider value
adding acquisitions and its preliminary outlook for 2008 would be as follows:-  After completion of the divestiture, 2008 production is forecast to be
       approximately 9,000 boe/d, comprised of 40,200 mcf/d of natural gas
       and 2,300 bbls/d of light/medium oil. True's primary focus will
       initially be on assets located in West Central and Northern Alberta.
       True's 2008 capital expenditure program would be increased from the
       currently planned $40 million to approximately $60 million. True
       expects to receive sufficient proceeds from the planned divestiture to
       eliminate its existing bank indebtedness and fund the increased
       capital program. The expanded drilling program in 2008 will initially
       focus on light oil opportunities and future plans would include
       increased drilling programs for 2009 through 2010. A portion of True's
       capital program over 2008 to 2010 would include an exploration
       component. The planned 2008 exploration program of $5 million includes
       the drilling of six 100% working interest wells in three areas.

    -  With the Trust's improved financial flexibility, True plans to seek
       opportunities to consolidate assets that complement its focused asset
       base either through geographic fit, technical expertise or future
       development potential.Asset Divestiture

    True intends to divest of its oil and natural gas assets in Saskatchewan
including properties at Kerrobert, Mantario, and Smiley. The assets also
include 275,000 net acres of land. Current production from the Saskatchewan
properties is approximately 5,600 boe/d, including 13,000 mcf/d of natural
    True anticipates significant proceeds from the disposition of its
Saskatchewan properties in a time of historically high oil prices and the
current favorable royalty regime in Saskatchewan. Proceeds from the proposed
divestiture will be utilized to eliminate True's bank indebtedness and to
provide additional financial resources to develop its Alberta light oil and
natural gas plays. True would continue to have approximately $85 million in
7.5% convertible unsecured subordinated debentures ("Debentures") outstanding.
The Debentures were issued on June 15, 2006, through a public offering and
have a maturity date of June 30, 2011. The Debentures are convertible at any
time at the option of the holders into trust units of the Trust at a
conversion price of $16 per Trust unit. The Trust will have the right to
redeem all or a portion of the Debentures at a premium commencing after June
30, 2009 through to maturity.
    Scotia Waterous Inc. ("Scotia Waterous") has been selected to act as
True's exclusive advisor in this process. Detailed information with respect to
the assets being offered for sale will be available for review through Scotia


    True confirms that the cash distribution for the month of December will
be $0.08 per unit, to be paid on January 15, 2008 to all unitholders of record
as at December 31, 2007. The ex-distribution date for this payment is December
27, 2007. This distribution announcement is consistent with the guidance
provided in the news release dated October 15, 2007.
    True Energy Trust also announces that the Board of Directors has set the
distribution policy of the Trust for the first quarter of 2008 at a monthly
distribution rate of $0.04 per unit, subject to monthly confirmation by the
Board of Directors, based on current commodity prices, hedging program,
anticipated production volumes and market conditions. True anticipates that
this reduction will allow the Trust's distributions to be sustainable in the
current gas price, foreign exchange rate and cost environment. Based on the
December 14, 2007 closing price of $3.12 this represents an annualized yield
of 15.4%.Distribution         Record Date    Ex-distribution Date    Payable Date
    $0.08 per unit      Dec. 31, 2007      Dec. 27, 2007       Jan. 15, 2008
    $0.04 per unit(2)   Jan. 31, 2008      Jan. 29, 2008(1)    Feb. 15, 2008
    $0.04 per unit(2)   Feb. 29, 2008      Feb. 27, 2007(1)    Mar. 17, 2008
    $0.04 per unit(2)   Mar. 31, 2008      Mar. 27, 2007(1)    Apr. 15, 2008

    (1) Anticipated ex-distribution dates for January, February and March.
        These dates are subject to change and/or confirmation by the Toronto
        Stock Exchange and will be confirmed by monthly press releases.
    (2) Based on True's current commodity prices, hedge positions,
        anticipated production volumes and market conditions and subject to
        change based on actual conditions.True believes that by taking these steps, the characteristics of the
focused asset base and the increased financial flexibility will enable the
Trust to deliver long term returns to unitholders through ongoing yield and
the potential for capital appreciation.

    Personnel Announcements

    Further to a press release dated November 8, 2007, True announced the
appointment of Wayne M. Chorney as Chief Executive Officer and Director of
True following the resignation of Paul R. Baay as True's Chairman and Chief
Executive Officer. William C. (Mickey) Dunn reassumed his role as Chairman of
the Board and Mr. Baay remained a director of True. Effective November 19,
2007, Paul R. Baay resigned from the Board. On behalf of the Board, True would
like to thank Mr. Baay for his many years of dedicated service since founding
True in September of 2000.

    Conference Call

    True will hold a conference call on Monday, December 17, 2007 at 2:00 PM
MST/4:00 PM EST. To participate, please call toll-free 1-800-731-6941 or
416-644-3415. The conference call will also be recorded and available by
calling 1-877-289-8525 or 416-640-1917 and entering passcode 21257332 followed
by the number key.
    A full presentation of True's 2008 forward plan and guidance will be
posted at in January 2008.

    True Energy Trust is an exploration and production oil and gas trust
based in Calgary, Alberta, Canada. True is powered by a diverse asset base and
is focused on sustainable growth both in its people and in its properties.

    Forward Looking Statements: Certain information set forth in this news
release, including management's assessments of the future plans and
operations, True's planned disposition of Saskatchewan properties, the timing
thereof, the use proceeds and the effect of the disposition on True's
continuing operations, expected production levels, capital expenditure levels
and the allocation thereof and wells to be drilled and distribution levels may
contain forward-looking statements, and necessarily involve risks and
uncertainties, certain of which are beyond True's control including, risks
associated with oil and gas exploration, development, exploitation,
production, marketing and transportation, loss of markets and other economic
and industry conditions, volatility of commodity prices, currency
fluctuations, imprecision of reserve estimates, environmental risks,
competition from other producers, inability to retain drilling services,
incorrect assessment of value of acquisitions and failure to realize the
benefits therefrom, delays resulting from or inability to obtain required
regulatory approvals, the lack of availability of qualified personnel or
management, risks related to closing of dispositions, stock market volatility
and ability to access sufficient capital from internal and external sources,
economic or industry condition changes or the inability to dispose of the
Saskatchewan properties for the anticipated proceeds or delay in doing so.
Actual results, performance or achievements could differ materially from those
expressed in, or implied by, these forward-looking statements and,
accordingly, no assurance can be given that any events anticipated by the
forward-looking statements will transpire or occur, or if any of them do so,
what benefits that True or its securityholders will derive therefrom.
Additional information on these and other factors that could affect True are
included in reports on file with Canadian securities regulatory authorities
and may be accessed through the SEDAR website (, at True's
website ( Furthermore, the forward-looking statements
contained in this news release are made as of the date of this news release,
and True does not undertake any obligation to update publicly or to revise any
of the included forward-looking statements, whether as a result of new
information, future events or otherwise, except as may be expressly required
by applicable securities law.

    BOE Disclosure: Barrels of oil equivalent ("boe") may be misleading,
particularly if used in isolation. A boe conversion ratio of 6 mcf:1 bbl is
based on an energy equivalency conversion method primarily applicable at the
burner tip and does not represent a value equivalency at the wellhead.
    %SEDAR: 00021401E

Bellatrix Exploration Ltd.
1920, 800 5th Avenue SW
Calgary, Alberta T2P 3T6
Main: 403-266-8670
Fax: 403-264-8163
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