Exploration & Production | Debt | Capital Markets

Ivanhoe Energy's Future Uncertain

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Ivanhoe Energy Inc. has announced that the company's Board of Directors has been engaged in a process with its financial advisors to devise and implement a strategy to address Ivanhoe's liquidity, funding requirements and capital structure.

Strategic and financial alternatives under consideration are focused on relieving the financial burden of the company's current debt structure and obtaining additional financing necessary to fund ongoing operations. The alternatives under discussion and review include the sale of all or a portion of the company's assets, recapitalization, debt restructuring or a combination of the foregoing.

The company also announced that it does not expect to make the cash interest payment (approx. C$2.1 million / US$1.8 million) due on December 31, 2014 in respect of its outstanding 5.75% convertible unsecured subordinated debentures. As previously disclosed in the company's Form 10-Q Interim Report for the period ended September 30, 2014, material uncertainty exists as to the company's ability to access additional financing. Without timely access to additional financing, there is significant doubt as to the company's ability to continue as a going concern.

The company will make additional disclosure respecting the status of this ongoing strategic and financial review process once the Board of Directors decides to pursue a specific transaction or series of transactions, or otherwise determines that disclosure is necessary or appropriate. There can be no assurance that the current process will result in a transaction or, if a transaction is undertaken, that it will be successfully concluded in a timely manner or at all.