TIDMEDG
RNS Number : 2226U
Edge Resources Inc.
28 July 2015
FOR IMMEDIATE RELEASE
TSX Venture Exchange Symbol: EDE
AIM Exchange Symbol: EDG July 28, 2015
EDGE RESOURCES INC. Calgary, Alberta
Edge Resources Inc. Announces New Major Capital Partner and
Completion of Equity Financing
Edge Resources Inc. ("Edge" or the "Company") is pleased to
announce that it has closed a private placement for gross proceeds
of CDN$500,000 with a new, strategic investor group (the "Investor
Group").
The private placement subscription was completed by the Investor
Group at a price of $0.08 per share, representing a 10.5% premium
to the previous 10 day end-of-day volume weighted average price
("EOD VWAP"). A finder's fee equivalent to 5% of the gross proceeds
was paid in cash. The net proceeds will be used to support the
Company's ongoing acquisition strategy.
The funding is a planned first step by this Investor Group who
has indicated an intention to become a significant new, long-term
capital partner through the funding of several potential
acquisitions in the coming months.
After several months of due diligence, the Investor Group
selected Edge and its management team to become a platform through
which to make significant investments into the Canadian oil and gas
industry. The price paid demonstrates the Investor Group's macro
and long-term commitment to strengthening Edge's balance sheet and
supporting Edge's acquisition strategy in partnership with Edge's
other significant shareholders and lenders. Edge's two largest
shareholders, one of which is also a significant lender to the
Company, are supportive of the Investor Group and its intentions to
assist in funding the Company's major growth initiatives.
Growth Strategy
As stated in previous releases, Edge is intent on achieving
shareholder value creation through the pursuit of aggressive and
focused growth. Management believes this may best be achieved
through the merger and acquisition opportunities that are available
in a volatile market such as the oil and gas industry is
experiencing today.
The Company believes that high quality drilling locations
currently in inventory are best left in inventory and opportunities
to acquire additional production, land and drilling locations are
best acquired in market conditions such as today's.
The cornerstone of Edge's corporate acquisition and
consolidation strategy is a major focus on medium and heavy oil
acquisition targets, both corporate and asset based. In
management's opinion, the consolidation of medium and heavy oil
assets offer the most value-enhancing growth opportunity in the
Company's history. Medium and heavy oil assets offer:
1. The same - or better - full cycle ROI's compared to light oil assets for experienced operators
2. A less competitive consolidation arena; thus, lower entry
costs, leading to better economic returns
3. A broad distribution of assets amongst smaller players,
making consolidation and efficient way to release economic value
trapped in over-administrated, operationally inefficient
entities
4. An area of consistently demonstrated expertise for the Edge
management team with industry-leading low operational costs and
efficiencies
Edge expects the availability of high-return projects to
increase in the future, facilitated by (i) lack of sustaining cash
flow amongst junior E&P companies resulting in a lack of
drilling and; therefore, intensified production declines and (ii)
less patient lenders for E&P companies that lack strong capital
partners and/or sustaining cash flow.
Brad Nichol, Edge's President and CEO commented, "Being able to
raise new capital in this very challenging market is an
accomplishment that few have been able to demonstrate. We have
consistently proven it to be one of our core strengths and it is an
absolutely critical competitive advantage in our industry; and one
that is currently enjoyed by few. To have a new capital partner
commit now, as we embark on an aggressive growth strategy through
consolidation of medium and heavy oil assets, signifies a major
kick-start to Edge becoming one of Canada's high-growth E&P
companies. I am especially excited that the Investor Group,
combined with the support of our current lenders and major
shareholders, should allow us to expand our existing production and
growth profile as acquisition prices approach historical lows. We
aim to become one of the largest E&P companies focused on
medium and heavy oil, for the sole benefit of our existing and new
shareholders, and today's news is a significant step in that
direction.
Additional information may also be available at www.edgeres.com
or www.sedar.com or contact:
Brad Nichol - President & CEO
Phone: +1 (403) 767 9905
OR
Ward Kondas
Email: wkondas@edgeres.com
Phone +1 (778) 918-8384
Sanlam Securities UK Limited Phone: +44 (0)20 7628 2200
(Joint Broker and NOMAD)
Simon Clements / James Thomas
/ Max Bascombe
SP Angel Corporate Finance Phone: +44 (0)20 3463 2260
LLP (Joint Broker)
John MacKay / Richard Hail
/ Stuart Gledhill
About Edge Resources Inc.
Edge Resources is focused on developing a balanced portfolio of
oil and natural gas assets from properties in Alberta and
Saskatchewan, Canada. Management has consistently focused on:
1. Shallow, vertical, conventional programs with reduced
capital, operational and geological risks
2. Very high or 100% working interests and fully operated assets
3. Pools and horizons with exceptionally high reserves in place
The management team's very high drilling success rate is based
on the safe, efficient deployment of capital and a proven ability
to efficiently execute in shallow formations, which gives Edge
Resources a sustainable, low-cost, competitive advantage.
The term "boe" may be misleading, particularly if used in
isolation. A boe conversion ratio for natural gas of 6 Mcf: 1 boe
has been used, which is based on an energy equivalency conversion
method primarily applicable at the burner tip and does not
necessarily represent a value equivalency at the wellhead. As the
value ratio between natural gas and crude oil based on the current
prices of natural gas and crude oil is significantly different from
the energy equivalency of 6:1, utilizing a conversion on a 6:1
basis may be misleading as an indication of value.
The term "bopd" means "barrels of oil per day." The term "boepd"
means "barrels of oil equivalent per day."
Unaudited Financial Information
Certain financial and operating information included in this
press release for the year ended March 31, 2015, such as capital
expenditures, production, F&D costs and FD&A costs are
based on unaudited financial results, and are subject to the same
limitations as discussed under "Forward-Looking Information". These
estimated amounts may change upon the completion of audited
financial statements for the year-ended March 31, 2015 and changes
could be material.
Forward-Looking Statements
This news release includes certain information, with
management's assessment of Edge's future plans and operations, and
contains forward-looking statements which may include some or all
of the following: (i) anticipated production rates; (ii) expected
results of capital programs; (iii) expected timelines for
production optimization; (iv) net debt levels; (v) anticipated
operating costs; and (vi) expected capital projects and associated
spending; which are provided to allow investors to better
understand the Company's business. By their nature, forward-looking
statements are subject to numerous risks and uncertainties; some of
which are beyond Edge's control, including the impact of general
economic conditions, industry conditions, volatility of commodity
prices, currency fluctuations, imprecision of reserve estimates,
environmental risks, changes in environmental tax and royalty
legislation, competition from other industry participants, the lack
of availability of qualified personnel or management, stock market
volatility and ability to access sufficient capital from internal
and external sources, and other risks and uncertainties described
under the heading 'Risk Factors' and elsewhere in the Company's
Management Discussion and Analysis and other documents filed with
Canadian provincial securities authorities and are available to the
public at www.sedar.com. Readers are cautioned that the assumptions
used in the preparation of such information, although considered
reasonable at the time of preparation, may prove to be imprecise
and, as such, undue reliance should not be placed on
forward-looking statements. The principal assumptions Edge has made
includes security of land interests; drilling cost stability;
finance and debt markets continuing to be receptive to financing
the Company, the ability of the Company to monetize non-core assets
and industry standard rates of geologic and operational success.
Actual results could differ materially from those expressed in, or
implied by, these forward-looking statements. Edge disclaims any
intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by law. For more information on
the Company, Investors should review the Company's registered
filings which are available at www.sedar.com.
This news release shall not constitute an offer to sell or the
solicitation of any offer to buy, nor shall there be any sale of
these securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful. The securities offered have
not been and will not be registered under the U.S. Securities Act
of 1933, as amended, and may not be offered or sold in the United
States absent registration or applicable exemption from the
registration requirements of the U.S. Securities Act and applicable
state securities laws.
Trading in the securities of Edge Resources Inc. should be
considered highly speculative. 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.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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