CALGARY, Canada, May 28, 2012 /PRNewswire/ -- FEC RESOURCES INC. (OTCBB: FECOF, Frankfurt/Munich: FE8) ("FEC") wishes to advise shareholders that it has noted the following announcement made by Forum Energy PLC.
"May 25 2012
Increase in loan facility from Philex Mining Corporation
The Board of Forum is pleased to announce that Forum Philippines Holdings Limited, a wholly-owned subsidiary of the Company, has today agreed an increase in its existing loan facility agreement with Philex Mining Corporation (the "Facility").
The Facility has been increased from US$10 million to US$15 million. The Facility is unchanged otherwise from the original three year Facility which was announced on 24 November 2010, and which has now been drawn down in full. The repayment date for all amounts drawn under the Facility will therefore remain as 24 November 2013, and funds will continue to be borrowed at an interest rate of LIBOR + 4.5%. The Company also remains as the guarantor under the Facility.
The increase in the Facility will assist in funding Forum's working capital requirements, in particular in the planning stages of the second sub-phase of the work programme for SC72, the Company's principal asset.
Philex Mining Corporation is the parent company of Forum's two principal shareholders, Philex Petroleum Corporation and FEC Resources Inc., and is therefore a related party of the Company. As a result, the increase in the facility is a related party transaction under the AIM Rules for Companies. The independent director of the Company considers, having consulted with Execution Noble & Company Limited, the Company's nominated adviser, that the terms of the Facility are fair and reasonable insofar as the Company's shareholders are concerned.
Andrew Mullins, Executive Director, commented:
"We are delighted to have been able to arrange the increase in the Facility to US$15 million, on the same attractive terms. The Facility will enable the Company to move forward with planning the SC72 drilling programme. As previously announced, we will continue discussions with our major shareholders, our joint venture partner and our advisors to determine how the full SC72 drilling programme will be funded. We look forward to releasing further updates as appropriate.""
On behalf of the Board of,
FEC Resources Inc.
This press release contains forward-looking statements and forward-looking information (collectively, "forward-looking statements") within the meaning of applicable Canadian and US securities legislation. All statements, other than statements of historical fact, included herein are forward-looking statements. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward looking statements as a result of various factors, including, but not limited to, variations in the nature, quality and quantity of any natural resources that may be located, variations in the market price of any natural resource products the Company may produce or plan to produce, the Company's inability to obtain any necessary permits, consents or authorizations required for its activities, the Company's inability to produce natural resources from its properties successfully or profitably, to continue its projected growth, to raise the necessary capital or to be fully able to implement its business strategies, and other risks and uncertainties disclosed in the Company's Annual Report on Form 20-F for the year ended December 31, 2011 and its most recent quarterly reports filed with the United States Securities Exchange Commission (the "SEC"), and other information released by the Company and filed with the appropriate regulatory agencies. All of the Company's Canadian public disclosure filings may be accessed via www.sedar.com and its United States public disclosure filings may be accessed via www.sec.gov, and readers are urged to review these materials.