CALGARY, ALBERTA--(Marketwire - March 11,
2009) - NAL Oil & Gas Trust (the "Trust" or "NAL") (TSX:NAE.UN) will
pay a distribution of $0.09 per unit on April 15, 2009, to Unitholders
of record on March 23, 2009. The units will begin trading on an
ex-distribution basis on March 19, 2009. The current distribution
represents a $0.02 per unit reduction from the previous monthly
distribution level of $0.11 per unit.
Given the Trust's strong commitment to operate within forecast cash
flow and belief that prudence in these uncertain times is critical, the
Board of Directors has decided the proper course of action is to reduce
the current distribution level.
NAL's cash flow forecast is based on full year commodity assumptions
of US$45/bbl WTI and C$5.00/GJ AECO with a foreign exchange assumption
of US/CAD $1.25. These assumptions, combined with a current capital
expenditure budget of $95 million necessitate the revised level of
distribution and permit the Trust to preserve its balance sheet
advantage for opportunities that may exist in the market.
The current monthly distribution annualized totals $1.08 per unit,
and represents an 18.2% cash-on-cash yield based on the March 10, 2009
closing unit price of $5.94.
NAL Oil & Gas Trust's Board of Directors sets distribution
levels taking into consideration commodity prices, forecast cash flow of
the Trust, financial market conditions, availability of financing,
internal capital investment opportunities and taxability.
The Trust will continue to actively monitor commodity prices and
financial market conditions, making adjustments up or down to the
capital program and distribution level as required throughout the year.
REINSTATEMENT OF THE DISTRIBUTION REINVESTMENT PLAN
NAL also announces today that the Trust intends to reinstate the
Distribution Reinvestment Plan ("DRIP") effective with the March
distribution payable on April 15, 2009.
The DRIP, which has been suspended since October, 2008, provides
eligible Unitholders with the opportunity to reinvest the cash
distributions payable by the Trust on their units toward the purchase of
new units at a 5% discount to the volume weighted average price of the
units over the "Pricing Period" as defined in the DRIP. Further details
and enrollment forms for the DRIP are available on NAL's website at: http://www.nal.ca
Unitholders that were participating in the DRIP prior to the
suspension of the program in October 2008 will be automatically
re-enrolled and no action is required.
Eligible Unitholders that had previously not opted in to the DRIP
but now wish to do so, may elect to participate by contacting their
broker, investment dealer or financial institution holding their trust
units and requesting them to enroll on their behalf before March 23,
2009. Unitholders who are not residents of Canada are not permitted to
participate in the DRIP.
DRIP proceeds will be directed toward NAL's ongoing 2009 capital program and the reduction of outstanding bank debt.
NAL Oil & Gas Trust provides investors with a yield-oriented
opportunity to participate in the Canadian Upstream Conventional Oil and
Gas Industry. The Trust generates monthly cash distributions for its
Unitholders by pursuing a strategy of acquiring, developing, producing
and selling crude oil, natural gas and natural gas liquids from pools in
southeastern Saskatchewan, central Alberta, northeastern British
Columbia and Lake Erie, Ontario. Trust units trade on the Toronto Stock
Exchange under the symbol "NAE.UN".
NAL Oil & Gas Trust
Manager, Investor Relations
(403) 294-3620 or Toll Free: 1-888-223-8792
(403) 515-3407 (FAX)