UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of
report (Date of earliest event reported): July
15, 2013
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FOREST OIL CORPORATION |
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(Exact name of registrant as specified in its charter) |
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New York |
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(State or other jurisdiction of incorporation) |
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1-13515 |
25-0484900 |
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(Commission File Number)
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(IRS Employer Identification No.)
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707 17th Street, Suite 3600, Denver, Colorado |
80202 |
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(Address of principal executive offices) |
(Zip Code) |
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303.812.1400 |
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(Registrant’s telephone number, including area code) |
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(Former name or former address, if changed since last report) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
⃞ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
⃞ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
⃞ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
⃞ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 7.01. Regulation FD Disclosure.
On July 15, 2013, Forest Oil Corporation (“Forest”) issued a press release announcing that, after receiving unsolicited proposals from third parties interested in acquiring Forest’s oil and gas assets located in the Texas Panhandle Area, Forest’s Board of Directors has determined that Forest will initiate a marketed process to pursue the sale of such assets. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
The information in Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended.
Item 8.01. Other Events.
On July 15, 2013, Forest issued a press release announcing that Forest’s Board of Directors has determined that Forest will initiate a marketed process to pursue the sale of Forest’s oil and gas assets located in the Texas Panhandle Area. Forest has retained J.P. Morgan Securities LLC to assist in the marketing efforts.
Estimated proved reserves relating to Forest’s Texas Panhandle assets as of December 31, 2012, represented approximately 47% of Forest’s total estimated proved reserves. Revenues from Forest’s Texas Panhandle assets were $49.8 million (not including net realized gains on derivative instruments) in the first quarter of 2013, representing approximately 47% of Forest’s total revenues in the first quarter of 2013. Forest’s Texas Panhandle Area assets include approximately 100,000 acres, which are largely operated by Forest and held by production, and consist of approximately 50% liquids and 50% natural gas (on a net production basis). All amounts included in this Item 8.01 are pro forma for the sale of Forest’s South Texas assets and Forest’s Eagle Ford Shale joint venture, which occurred in the first half of 2013.
The potential sale of Forest’s Texas Panhandle assets is subject to market conditions, and there is no assurance that it will be completed, in whole or in part, or by any particular time. If the potential sale of Forest’s Texas Panhandle assets is completed, Forest intends to use the proceeds to reduce its indebtedness and enhance its financial flexibility. Upon completion of the potential sale of Forest’s Texas Panhandle assets, Forest’s remaining asset portfolio will be anchored by its ongoing oil development opportunity in the Eagle Ford Shale. In addition, Forest has a position of 111,000 net acres in East Texas, which is largely held by production and upon which Forest plans to continue the development of its oil and natural gas liquids properties. Forest also intends to maintain its exposure to potential natural gas development through its low-decline natural gas properties in the Ark-La-Tex region.
Item 9.01. Financial Statements and Exhibits.
| Exhibit No. | Document | |
| 99.1 | Press Release Announcing Forest’s Intent to Sell Texas Panhandle Assets. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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FOREST OIL CORPORATION |
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(Registrant) |
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Dated: |
July 15, 2013 |
By |
/s/ Cyrus D. Marter IV |
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Cyrus D. Marter IV |
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Senior Vice President, General |
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Counsel and Secretary |
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EXHIBIT INDEX
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Exhibit No. |
Description |
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99.1 |
Press Release Announcing Forest’s Intent to Sell Texas Panhandle Assets. |
Page 5
Exhibit 99.1
Forest Oil Announces Intent to Sell Texas Panhandle Assets
DENVER--(BUSINESS WIRE)--July 15, 2013--Forest Oil Corporation (NYSE:FST) (Forest or the Company) announced today that, after receiving unsolicited proposals from third parties interested in acquiring Forest’s oil and gas assets located in the Texas Panhandle, Forest’s Board of Directors has determined that the Company will initiate a marketed process to pursue the sale of such assets. Forest has retained J.P. Morgan Securities LLC to assist in the marketing efforts. Forest intends to use any proceeds from a potential sale to reduce debt and enhance financial flexibility.
Patrick R. McDonald, President and CEO commented, “Over the last several years, drilling and completion efforts by Forest and other companies have delineated substantial oil, natural gas and natural gas liquids resources in the Texas Panhandle. Our significant acreage position, which is largely operated by Forest and held by production, presents a large-scale, low-risk development opportunity. If completed, the sale of the Texas Panhandle assets should allow us to reduce meaningfully our indebtedness and enhance our financial flexibility and ability to accelerate development of our assets. Upon successful completion of a transaction, Forest’s remaining asset portfolio will be anchored by its ongoing oil development opportunity in the Eagle Ford Shale, where oil production is projected to more than double during 2014. In addition, the Company has a position of 111,000 net acres in East Texas which is largely held by production and upon which the Company plans to continue the development of its oil and natural gas liquids properties. The Company also intends to maintain its exposure to potential natural gas development through its low-decline natural gas properties in the Ark-La-Tex region.”
FORWARD-LOOKING STATEMENTS
This news release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, that address activities that Forest assumes, plans, intends, expects, believes, projects, estimates or anticipates (and other similar expressions) will, should, or may occur in the future are forward-looking statements. The forward-looking statements provided in this press release are based on management's current belief, based on currently available information, as to the outcome and timing of future events. Forest cautions that future natural gas and liquids production, revenues, cash flows, liquidity, plans for future operations, expenses, outlook for oil and natural gas prices, timing of capital expenditures, timing and terms of any divestitures, and other forward-looking statements relating to Forest are subject to all of the risks and uncertainties normally incident to the exploration for and development and production and sale of liquids and natural gas.
These risks relating to Forest include, but are not limited to, oil and natural gas price volatility, its level of indebtedness, its ability to replace production, its ability to compete with larger producers, environmental risks, drilling and other operating risks, regulatory changes, credit risk of financial counterparties, risks of using third-party transportation and processing facilities, the decision to sell or offer for sale, or to determine not to sell any portion of its assets, the ability to enter into agreements relating to such sales on desirable terms or at all, the timing of any such agreements, the ability to consummate any such sales, the ability to realize the anticipated benefits of any such sales, the ability to determine the use of proceeds from any such sales, the ability to determine whether to reduce outstanding indebtedness and the amount and timing of any such reductions, and other risks as described in reports that Forest files with the SEC, including its Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K. Any of these factors could cause Forest's actual results and plans to differ materially from those in the forward-looking statements.
Forest Oil Corporation is engaged in the acquisition, exploration, development, and production of natural gas and liquids in the United States and selected international locations. Forest's principal reserves and producing properties are located in the United States in Arkansas, Louisiana, Oklahoma, Texas, and Wyoming. Forest's common stock trades on the New York Stock Exchange under the symbol FST. For more information about Forest, please visit its website at www.forestoil.com.
CONTACT:
Forest Oil Corporation
Larry C. Busnardo, 303-812-1441
Director,
Investor Relations