Toreador Resources Corporation has entered into a letter of intent to sell 26.75% of the company's 36.75% interest in the South Akcakoca Sub-basin natural gas project and eight contiguous exploration blocks in the Turkish Black Sea for gross proceeds of $80.25 million.

The transaction is subject to Turkish government approval and joint venture partners' preemption rights. After the transaction Toreador will retain a 10% working interest in the joint venture. Net proceeds from the sale will be used to reduce debt and for general corporate purposes.

The transaction is expected to be completed early in the fourth quarter. However, no assurance can be given that the transaction will close on the terms contemplated. As described below, the company is incurring an asset impairment charge due to entering into the letter of intent.

"The completion of this transaction will help us achieve two important strategic goals," said Toreador President and Chief Executive Officer, Nigel Lovett. "First, we will greatly reduce our operational risk to one more appropriate for a company of our size and, secondly, we can use the proceeds to strengthen our balance sheet and reduce our financial risk. We believe the metrics associated with this transaction materially exceed all the metrics on which our company as a whole currently trades."

Tags: Toreador Resources Corporation