Frequently Asked Questions

All information in this “FAQ” is for the purpose of general knowledge only and does not provide any financial, legal, tax or investment advice to anyone currently invested in or considering investing in Argent Energy Trust. You should seek the advice of an independent financial, legal tax or investment advisor based on your particular circumstances.

How will the distributions be taxed?
    – Any distributions will be ~63%/~89% (US/Canada) return of capital (which reduces the cost base and
       hence is only taxed as capital gain when the units are sold).
    – If the units are held in a RRSP or TFSA, taxes are deferred. 
    – There is no U.S. tax liability or withholding for a Canadian resident. 

What is the payout ratio?
    –The level of distribution in 2014 represented approximately 20% of cash flow from operations.

Do any distributions from Argent Energy Trust qualify for Dividend Tax Credit?
    – No. Dividend tax credits apply to dividends paid by a corporation, and are not generally applicable to
       trust distributions.

Can U.S. residents purchase this security and if so how will any distribution be taxed in the U.S.?
    – U.S. residents may purchase Units on the open market through the facilities of the Toronto Stock
    – There is currently no withholding tax on distributions made to U.S. Unitholders.

Does Argent Energy Trust hedge CAD distributions to cover your U.S. exposure?
    – At this point our currency “hedging” is limited to forward buys of CDN$  only when needed.

What is Argent’s Hedging Policy?
    – Argent aims to hedge up to 70% of its production for 12 months, up to 60% of its production between 13
       months to 24 months and up to 50% of its production between 25 months to 36 months in the future.

I’m particularly concerned about the fracking process used by oil and gas exploration. Does Argent employ it?
    – When we do drill natural gas wells – they are very deep (in excess of 10,000 feet/3,400 meters) and we
       employ a normal vertical well bore, perforate and do a relatively low pressure fracture job, well below
       the water table.
    – We employ extensive “fracking” when completing our Eagle Ford Shale oil wells.
    – Eagle Ford depth is at 9,500 feet/3,200 meters and well below the water table (around 300 to 500 feet).