CELTIC EXPLORATION LTD. 
By
December 14, 2012
Calgary, Alberta
CALGARY, Alberta, December 14, 2012 - Celtic Exploration Ltd. ("Celtic") (TSX: CLT) announced today that holders ("Shareholders") of common shares of Celtic ("Celtic Shares") and holders ("Debentureholders") of 5.00% convertible unsecured subordinated debentures of Celtic due April 30, 2017 ("Debentures") have each approved the special resolution relating to the proposed acquisition of Celtic by ExxonMobil Celtic ULC (the "Purchaser"), an indirect subsidiary of Exxon Mobil Corporation, pursuant to a plan of arrangement under the Business Corporations Act (Alberta) (the "Arrangement").
The Arrangement was approved by approximately 99.82% of the votes cast by Shareholders and by holders of 71.81% of the aggregate principal amount of Debentures (of which 100% were voted in favour of the Arrangement) at the special meeting of Shareholders and Debentureholders held earlier today (the "Meeting"). The final order in respect of the Arrangement was also granted today by the Court of Queen's Bench of Alberta.
At the Meeting, Shareholders also approved ordinary resolutions approving: (i) a stock option plan for Kelt Exploration Ltd. ("Kelt") to be effective upon completion of the Arrangement; (ii) a restricted share unit plan for Kelt to be effective upon completion of the Arrangement; and (iii) the private placement of up to 6,000,000 common shares of Kelt ("Kelt Shares") at a subscription price equal to the estimated net asset value of Kelt on a per share basis following completion of the Arrangement, of C$2.32 per Kelt Share, for aggregate gross proceeds of approximately C$13.9 million (the "Private Placement"). The Private Placement is expected to close immediately following completion of the Arrangement.
The closing of the Arrangement remains subject to the receipt of the approval of the Arrangement under the Investment Canada Act (the "Investment Canada Approval") and the satisfaction or waiver of the other conditions specified in the arrangement agreement between Celtic, ExxonMobil Canada Ltd., the Purchaser and Kelt entered into on October 16, 2012 (the "Arrangement Agreement"). A "no action" letter confirming that the Commissioner of Competition does not intend to make an application to the Competition Tribunal under section
92 of the Competition Act (Canada) (the "Competition Act") in respect of the Arrangement has
been received and accordingly, no further approval is required under the Competition Act.
About Celtic
Celtic is a Calgary, Alberta, Canada-based oil and gas company focused on exploration, development and production of crude oil and natural gas resources primarily in west central Alberta. Celtic holds large acreage positions in the Montney and Duvernay resource gas plays. Throughout its history, Celtic has a proven track record of growing reserves, production and the underlying value of the company for its shareholders. Celtic Shares are listed on the Toronto Stock Exchange under the symbol CLT.
About Kelt
It is anticipated that Kelt will be a new publicly listed junior oil and gas exploration and production company led by Celtic's current management team, including David J. Wilson and Sadiq H. Lalani. Kelt expects to be a growth oriented company with initial production of approximately 3,300 BOE per day and an initial land position consisting of approximately 53,730 acres in the following three core areas: (a) a natural gas property at Grande Cache, Alberta; (b) a liquids-rich natural gas property at Inga, British Columbia; and (c) an oil prospect at Karr, Alberta.
Cautionary Statement on Forward-Looking Statements and Information
This press release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking information or statements. In particular, forward-looking statements and information in this press release include, but are not limited to: statements concerning the Investment Canada Approval; the ability of the parties to satisfy the other conditions to, and to complete, the Arrangement; the closing of the Private Placement and the anticipated proceeds to be realized thereunder; the estimated net asset value of Kelt upon completion of the Arrangement; and the business, properties and management of Kelt upon completion of the Arrangement.
The forward-looking statements and information contained in this press release are based on certain key expectations and assumptions made by Celtic, including, but not limited to: expectations and assumptions concerning the ability to obtain the Investment Canada Approval; the ability of the parties to satisfy the other conditions to the closing of the Arrangement; the completion of the Arrangement as currently contemplated; the completion of the Private Placement as currently contemplated; and the business, properties and management of Kelt upon completion of the Arrangement. Although Celtic believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because there can be no assurance that they will prove to be correct.
Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ
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materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to: the risk that the Arrangement may not close when planned or at all or on the terms and conditions set forth in the Arrangement Agreement; the failure to obtain the necessary Investment Canada Approval and other third party approvals required in order to proceed with the Arrangement; the failure to complete the Private Placement on the terms currently contemplated; operational risks in development, exploration and production for oil and gas; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve and resource estimates; health, safety and environmental risks; commodity price and exchange rate fluctuations; marketing and transportation; loss of markets; environmental risks; competition; incorrect assessment of the value of acquisitions; ability to access sufficient capital from internal and external sources; and changes in legislation, including, but not limited to, tax laws, royalties and environmental regulations. Readers are cautioned that the foregoing list of factors is not exhaustive.
Management has included the above summary of assumptions and risks related to the forward- looking statements and information provided in this press release in order to provide Celtic securityholders with a more complete perspective on the proposed Arrangement and such information may not be appropriate for other purposes. Actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward- looking statements and information and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements and information contained in this press release will transpire or occur, or if any of them do so, what benefits may be derived therefrom.
The forward-looking statements and information contained in this press release are made as of the date hereof and Celtic undertakes no obligation to update publicly or revise any forward- looking statements or information, whether as a result of new information, future events, or results or otherwise, other than as required by applicable securities laws.
Cautionary Statement on BOEs
Where amounts are expressed on a barrel of oil equivalent ("BOE") basis, natural gas volumes have been converted to oil equivalence at six thousand cubic feet per barrel and sulphur volumes have been converted to oil equivalence at 0.6 long tons per barrel. The term BOE may be misleading, particularly if used in isolation. A BOE conversion ratio of six thousand cubic feet per barrel is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
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Further Information
For further information, please contact:
Celtic Exploration Ltd., Suite 600, 321 - 6th Avenue SW, Calgary, Alberta, Canada T2P 3H3
David J. Wilson, President and Chief Executive Officer, 403-201-5340, or
Sadiq H. Lalani, Vice President, Finance and Chief Financial Officer, 403-215-5310. Or visit our website at www.celticex.com.
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