MT. PLEASANT, Mich., Dec. 20, 2002 (PRIMEZONE) -- Gastar Exploration Ltd. (TSE:YGA) is pleased to announce that it has entered into a Development Agreement with The Turbo Genset Company Ltd., the U.K. subsidiary of Turbo Genset Inc. (TSE:TGN).
Under the Development Agreement, the two companies will work together to develop electricity generation opportunities resulting from the combination of Gastar's strong asset position in conventional and unconventional natural gas and Turbo Genset's leading electricity generation technology.
The companies have initiated a market and technical analysis that is expected to result in the formation during early 2003 of an equally owned, joint venture company, which the parties anticipate naming "TurboStar Energy, Inc." TurboStar's mission will be to exploit various opportunities for electrical power generation using Coal Bed Methane (CBM), Coal Mine Methane (CMM), natural gas and geothermal energy. Under the agreement, Turbo Genset will provide technical support and sell generation hardware to the joint venture that will use gas sourced and sold from Gastar Properties to generate electricity. Initial equipment sales from Turbo are likely to include Variable Speed Generators (VSG's) that can be directly coupled to the grid or run islanded using Turbo Genset's unique Power Electronics capability.
The initial focus of the joint venture will be the generation of electricity from CBM and CMM assets owned by Gastar in North America and Australia and accordingly TurboStar will be the exclusive vehicle worldwide through which the partners will generate electricity for sale from CBM and CMM. Turbo Genset and Gastar are also both exclusively committed to TurboStar in operating further generation projects in North America and Australia and have a mutual first right of refusal on all other generation projects worldwide.
Thom Robinson, Chief Executive Officer of Gastar commented, "While Gastar will stay focused on it core business of finding and producing natural gas, the TurboStar venture creates several exciting business opportunities for Gastar. Gastar should be able to achieve higher net margins when participating in the sale of electricity. Turbo Genset's highly efficient technologies should accelerate Gastar's ability to demonstrate commerciality of lower BTU CMM in the United States as well as accelerate the commercial development of its Australian CBM assets. Turbo Genset's technology can greatly reduce the need for new infrastructure in some remote project areas, allowing Gastar to monetize certain assets far more rapidly. This is particularly important in Australia and the potential impact on Gastar's Australian asset values could be significant. Working with Turbo Genset's enthusiastic and knowledgeable team has been enlightening. We look forward to the future of this very exciting project."
Peter Hollins, CEO of Turbo Genset said, "We are very excited by the opportunity of working with Gastar. Turbo Genset has already done a lot of work developing its equipment for use in the Oil and Gas sector and this will be of great value in our relationship. We believe that the combination of our unique generation technology and Gastar's very strong and specialised position in gas production, particularly in CBM and CMM, will be a market-leading proposition. We are confident of this becoming a major new business opportunity."
Contact Information: Gastar Exploration Ltd. (TSE: YGA) 2480 West Campus Drive, Bldg C Mt. Pleasant, MI 48858 (989) 773-7050 FAX: (989) 773-0006 Attention: J. Russell Porter or Victor W. Hughes, Jr.
Email:rporter@gastar.com or vhughes@gastar.com Web Site: http://www.gastar.com/
NOTES TO EDITORS
Gastar Exploration Ltd. is an exploration and production company focused on finding and developing natural gas in North America and Australia. The Company pursues a balanced strategy combining low-risk CBM development with select higher risk, deep natural gas exploration prospects. Gastar's CBM activities are conducted within the Powder River Basin of Wyoming and upon the approximate 4 million acres controlled by Gastar in Australia's Gunnedah and Gippsland Basins located in New South Wales and Victoria respectively. The Company owns prospective acreage in the Bossier Sand gas play of East Texas and in the deep Temblor gas play in the East Lost Hills field within the San Joaquin Basin of California.
Turbo Genset Inc., through its wholly owned subsidiary, The Turbo Genset Co. Ltd ("TGC"), based in London, UK, has initiated commercialisation of its technology for power generation, transportation and industrial applications. Applications include mobile power generation, distributed power and standby power. Intelligent Power Systems ("IPS") was acquired in July 2001 and is a leading company in the design and manufacture of specialised power supplies and power management and control systems for a variety of applications. In addition to manufacturing and supplying power electronics to TGC, it provides products to major companies involved in the power electronics and motor control markets. IPS is based in the North East of England.
The shares of Gastar Exploration Ltd. are traded on the Toronto Stock Exchange under the symbol YGA. The shares of Turbo Genset Inc. are listed on the London Stock Exchange (www.londonstockexchange.com under the symbol TGN) and the Toronto Stock Exchange (www.tse.com under the symbol TGN).
This news release contains forward-looking statements. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events, or performance, and underlying assumptions and other statements that are other than statement of historical fact. These statements are subject to uncertainties and risks including, but not limited to, the ability to meet ongoing capital needs, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition, the need to protect proprietary rights to technology, government regulation, and other risks defined in this document and in statements filed from time to time with the applicable securities regulatory authorities.