Harvest Energy Trust – News
Release
(HTE.UN
– TSX; HTE - NYSE)
HARVEST ENERGY TRUST
CLOSES ACQUISITION OF NORTH ATLANTIC REFINERY AND MARKETING
BUSINESS
Calgary, October 19, 2006
(TSX: HTE.UN, NYSE: HTE) – Harvest Energy Trust ( "Harvest") is
pleased to announce that it has closed its previously announced
acquisition of North Atlantic Refining Limited ("North Atlantic")
and related businesses, for approximately CDN$1.6 billion plus
certain working capital and other adjustments from Vitol Refining
Group B.V. ("Vitol").
This transaction has been
financed from an expanded CDN$1.4 billion Three Year Revolving
Secured Credit Facility, a CDN$350 million Secured Bridge Facility
with an 18 month term and a CDN$450 million Senior Unsecured Bridge
Facility with a six month term. These credit facilities have been
successfully syndicated among a broad group of financial
institutions including Canada's six chartered banks and seven other
well respected global financial institutions.
"The inclusion of North Atlantic
with Harvest improves our long term sustainability and positions
Harvest as a uniquely integrated energy trust," said John Zahary,
Harvest's President and CEO. "The future potential of the refinery
includes approximately CDN$700 million of growth capital projects
with attractive incremental economics. North Atlantic continues to
produce gasoline and ultra low sulphur diesel products which meet
the stringent specification of the premium priced markets in the
United States with a relatively low level of annual capital
expenditures."
Harvest is currently evaluating
its bridge loan refinancing plans including capital markets options
as well as proceeds from the sale of a number of small assets. The
capital markets options include traditional term debt as well as
the issuance of convertible debentures and trust units.
Harvest has entered into a supply
and offtake agreement for a minimum period of up to 2 years with a
division of Vitol whereby Vitol will continue to supply the crude
oil feedstock for the North Atlantic refinery and will purchase its
refined products for sale outside Newfoundland. Vitol is one of the
world's largest physical traders and marketers of crude oil and
petroleum products. The supply and offtake agreement provides a
reliable and economic source of crude oil feedstock and ensures
competitive prices for the refined products. Harvest will work with
Vit
