MIDLAND, Texas, March 9, 2010 (GLOBE NEWSWIRE) -- Doral Energy Corp. (OTCBB:DRLY) ("Doral" or "the Company") announced today that it has received a forbearance on existing debt from Macquarie Bank. The forbearance covers existing debt of approximately $5.85 million as well as the Net Profits Interest currently held by the bank. The forbearance extends the credit agreement till April 1, 2010; however if certain conditions are meet the forbearance will automatically be extended till May, 1, 2010. These conditions are predicated on Doral Energy entering into a definitive PSA to divest a portion or all of its assets that will satisfy all outstanding debt due to Macquarie Bank, including the valuation of the Net Profit Interest. Additionally, the buyer will be required to deposit $500,000 into an escrow account on or before April 1, 2010.
Additionally the Company announced that a previously signed letter of intent ("LOI"), with Alamo Resources LLC, for the sale of fifty percent (50%) of Doral's interests in its oil and gas assets located in Eddy County, New Mexico has expired. The LOI was allowed to expire at the request of the potential buyer, not due to any actions on the part of Doral Energy. The Company continues to evaluate several offers that have been extended to Doral Energy's Board of Directors, including one from Alamo Resources LLC. The Company hopes to make a final announcement on its final course of action within the next two weeks.
E. Will Gray II, CEO & Vice Chairman of Doral, states, "Management continues to work tirelessly to examine multiple offers that allow Doral to pay the existing debt facility with Macquarie in full and allow us a viable path to grow the company and build maximum value for our shareholders. I know this has been a long process and tested the patience of all shareholders but the Board of Directors and the entire management team is committed to finding the opportunity that best allows us to meet our long term goals and objectives."
About Doral Energy Corp.
Doral Energy Corp. (OTCBB:DRLY) is an oil and gas exploitation and production company headquartered in Midland, Texas. Doral Energy Corp.'s strategy is to grow a portfolio of under-developed production and exploitation assets with the potential for generating near-term increases in existing production through operational improvements, and longer-term development of proved undeveloped reserves by infill drilling. Doral focuses on identifying acquisitions that generate immediate cash flow from production, but which also have strong proved developed non-producing and proved undeveloped reserves that can be tapped for significant growth. The prolific Permian Basin of Texas and New Mexico is the geographic region of focus for the Company's future acquisition activity. Shareholders and investors are encouraged to visit Doral Energy's website at www.DoralEnergy.com for more information.
Forward Looking Statements
This news release contains forward-looking statements that are not historical facts and are subject to risks and uncertainties. Forward-looking statements are based on current facts and analyses and other information that are based on forecasts of future results, estimates of amounts not yet determined, and assumptions of management. Forward looking statements are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "aims", "potential", "goal", "objective", "prospective", and similar expressions or that events or conditions "will", "would", "may", "can", "could" or "should" occur. Information concerning oil or natural gas reserve estimates may also be deemed to be forward looking statements, as it constitutes a prediction of what might be found to be present when and if a project is actually developed. In particular, there is no assurance that Doral will be able to re-finance its current credit facility or acquire any future properties.
Actual results may differ materially from those currently anticipated due to a number of factors beyond the reasonable control of the Company. It is important to note that actual outcomes and the Company's actual results could differ materially from those in such forward-looking statements. Factors that could cause actual results to differ materially include misinterpretation of data, inaccurate estimates of oil and natural gas reserves, the uncertainty of the requirements demanded by environmental agencies, the Company's ability to raise financing for operations, breach by parties with whom the Company has contracted, inability to maintain qualified employees or consultants because of compensation or other issues, competition for equipment, inability to obtain drilling permits, potential delays or obstacles in drilling operations and interpreting data, the likelihood that no commercial quantities of oil or gas are found or recoverable, and our ability to participate in the exploration of, and successful completion of development programs on all aforementioned prospects and leases. Additional information on risks for the Company can be found in the Company's filings with the U.S. Securities and Exchange Commission.