Teton Energy Corp.

Transaction Type
Post Date
Estimated Price

Rockies producer Teton Energy Corp., Denver, (Nasdaq: TEC) has retained Barrier Advisors Inc. of Dallas to evaluate strategic alternatives including the sale of assets or a merger. The move comes in advance of an anticipated borrowing-base reduction that puts doubt on the company's ability to continue as a going concern. Additionally, Teton president and chief executive Karl F. Arleth has resigned to pursue other interests. James Woodcock, currently chairman, has been named as interim CEO. The new borrowing base is anticipated from Teton's bank group in mid May and is expected to result in a deficiency, according to the company, which by contract is due in equal monthly payments over three months. Teton said in a statement, "The company does not currently have sufficient resources to fund its current working capital requirements and service the borrowing-base deficiency. Our ability to continue as a going concern is dependent upon the success of our financial and strategic alternatives process, which may include the sale of some or all of our assets, a merger or other business combination involving the company, or the restructuring and recapitalization of the company." Teton operations are concentrated in the Rockies and Midcontinent regions with interests in the Central Kansas Uplift, the Williston Basin in North Dakota, the Big Horn Basin in Wyoming and the eastern Denver-Julesburg Basin in Colorado, Kansas and Nebraska. Lonnie Brock, Teton executive vice president and chief financial officer, says, "The first quarter of 2009 has presented unique challenges. We continue to re-examine all aspects of the company's business and to look for areas of improvement…We have taken steps to improve our balance sheet and liquidity, including the sale of nonoperated assets, and we will continue to explore various alternatives with our debt and equity holders to further strengthen the balance sheet."