Valeura Energy Inc., Calgary, (TSX: VLE) has closed its previously announced acquisition of natural gas production in Turkey of approximately 10.0 MMcf/d (net before royalties), 588,719 net acres of land in the Thrace and Anatolian basins and exposure to a potential world-class unconventional tight gas opportunity for a total cash payment of US$57.3 million.

"This is a game-changing transaction for Valeura," says Jim McFarland, president and chief executive officer. "It boosts corporate production from less than 400 BOE/d to approximately 2,000 BOE/d and provides us with a large land position in the Thrace Basin with significant running room to pursue the bread and butter shallow gas play and to deploy modern technology to exploit a deeper tight gas sand and shale resource play. Turkey is an attractive place to do business given the competitive fiscal terms including a 12.5% royalty rate and 20% corporate tax rate, extensive oil and natural gas pipeline infrastructure, and a ready domestic market for oil and natural gas sales, which in the case of natural gas, is providing wellhead realizations of approximately US$7.00 to US$7.50 per Mcf."

The Acquisition

The acquisition was effected through a three-party arrangement between an affiliate of Valeura, TransAtlantic Worldwide Ltd. (TWL), a wholly-owned affiliate of TransAtlantic Petroleum Ltd., and Pinnacle Turkey Holding Company LLC (PTI Holdings). The acquisition closed contemporaneously with the closing of TWL's purchase of the shares of Thrace Basin Natural Gas (Turkiye) Corporation (TBNG), and PTI Holdings' purchase of the shares of Pinnacle Turkey Inc. (PTI). These shares were purchased from Mustafa Mehmet Corporation, which held 100% of the shares of TBNG and PTI, the two companies holding the assets in Turkey.

Through this transaction, Valeura has effectively acquired 40% of the total production of TBNG and PTI and working interests ranging from 15% to 40% in 19 leases and licenses.

The transfer of registered ownership of the assets to the Valeura affiliate will be subject to the approval of the General Directorate of Petroleum Affairs of the Republic of Turkey (GDPA), a process that is anticipated to take three to six months. Pending GDPA approval, the Valeura affiliate will retain the economic rights to the assets pursuant to a net profits interest agreement, effective April 1, 2011.