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Sterling Resources Announces Bridging Loan for US$12 Million and Further Financing Arrangements

CALGARY , Dec. 31, 2012 /CNW/ – Sterling Resources Ltd. (SLG.V) (“Sterling” or “the Company”) is pleased to announce that it has signed a secured US$12 million bridging loan agreement (the “Loan”) with a subsidiary of Vitol Holding B.V. (“Vitol”). Closing, is subject to TSXV approval and other customary conditions, which is expected in the next few days. The loan is intended to be used to fund remaining costs of the Ioana and Eugenia wells offshore Romania , certain other exploration costs on its Romanian oil and gas licences, ordinary course of business corporate costs in Canada and Romania and to repay funds temporarily advanced from the UK subsidiary to fund Romanian exploration costs in December. Together with existing cash resources, these funds are expected to last into early February 2013 .

The loan is secured by a first-ranking security package over Sterling’s offshore and onshore licences in Romania , a pledge of the shares of Sterling’s Romanian subsidiary, Midia Resources SRL, and a pledge of certain of Sterling’s receivables. The loan bears interest at a rate of LIBOR plus 1.0 percent, payable in arrears, subject to a maximum of 2.0 percent per annum during the term of the loan, and matures on March 31 , 2013. As consideration for the loan, Vitol is receiving 2,418,500 common shares of Sterling at a price of $0.717 per common share. The loan is repayable out of proceeds received from Romanian asset sales, including the previously announced sale of a portion of the Midia licence to ExxonMobil Exploration and Production Romania and OMV Petrom.

In addition the Company anticipates entering into a significantly larger private placement debt-based financing in January 2013. The proceeds of such a financing would allow for repayment of the Vitol bridging loan and would also fund remaining Breagh development costs through to first gas, other costs associated with Breagh and the UK senior secured £105 million loan facility including any partial loan repayment that may be required by the lenders of that facility, and other group costs through to first gas. The Company is also working to refinance its current senior secured credit facility for the Phase 1 development of the Breagh gas field during the next few months.

Sterling also reports that the UK secondary legislation regarding the changes to Small Field Allowance that benefit the Cladhan development came into force on December 20. Sterling now expects to receive in mid-January 2013 the second payment of US$4.33 million from TAQA Bratani Limited for the sale of 13.5 percent of Cladhan earlier this year.

Sterling Resources Ltd. is a Canadian-listed international oil and gas company headquartered in Calgary , Alberta with assets in the United Kingdom , Romania , France and the Netherlands. The shares are listed and posted for trading on the TSX Venture Exchange under the symbol “SLG”.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Filer Profile No. 00002072

Forward-Looking Statements

All statements included in this press release that address activities, events or developments that Sterling expects, believes or anticipates will or may occur in the future are forward-looking statements. In addition, statements relating to reserves or resources are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves and resources described can be profitably produced in the future. In particular, this document contains forward-looking information and statements regarding: (i) the intended use of proceeds from the Loan; (ii) the anticipated receipt of approval from the TSXV; (iii) future capital expenditures and projects; and (iv) the timing, quantum and purpose of future financings.

These forward-looking statements involve numerous assumptions made by Sterling based on its experience, perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. In addition, these statements involve substantial known and unknown risks and uncertainties that contribute to the possibility that the predictions, forecasts, projections and other-forward looking statements will prove inaccurate, certain of which are beyond Sterling’s control, including: the impact of general economic conditions in the areas in which Sterling operates, civil unrest, industry conditions, changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in commodity prices, foreign exchange or interest rates, stock market volatility and obtaining required approvals of regulatory authorities. In addition there are risks and uncertainties associated with oil and gas operations. Readers should also carefully consider the matters discussed under the heading “Risk Factors” in the Company’s Annual Information Form.

Undue reliance should not be placed on these forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. Sterling’s actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements. These statements speak only as of the date of the press release. Sterling does not intend and does not assume any obligation to update these forward-looking statements except as required by law.

Financial outlook information contained in this press release about prospective results of operations, financial position or cash flows is based on assumptions about future events, including economic conditions and proposed courses of action, based on management’s assessment of the relevant information currently available. Readers are cautioned that such financial outlook information contained in this press release should not be used for purposes other than for which it is disclosed herein.

SOURCE: Sterling Resources Ltd.


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Mike Azancot, President and Chief Executive Officer, Phone: 44-20-3008-8488, Mobile: 44-7740-432883,

David Blewden, Chief Financial Officer, Phone: 44-20-3008-8488, Mobile: 44-7771-740804,

George Kesteven, Manager, Corporate and Investor Relations, Phone: (403) 215-9265, Mobile: (403) 519-3912,