Point Loma Resources Announces Closing of Acquisition of Oil & Gas Assets - Amendment
01 Mayo 2018 - 10:08AM
Point Loma Resources Ltd. (TSX VENTURE:PLX) (the
“
Corporation” or “
Point Loma”) is
pleased to announce that it has acquired certain oil and gas assets
from a private oil and gas company involved in a receivership
process, with an effective date of November 1, 2017 (the
“
Acquisition”). After closing adjustments, the net
purchase price of the Acquisition was approximately $779,000 for
Point Loma’s 70 percent working interest share.
The
previously reported volumes and values per bullet four below were
in error.
Highlights (figures gross unless stated
otherwise):
- Point Loma (70 percent working interest) and Salt Bush Energy
Ltd. (“Salt Bush”) have acquired assets concentrated in the west
central area of Alberta contiguous to Point Loma’s existing area of
focus.
- Production of approximately 450 boe/d (315 boe/d net),
comprised of 35 percent oil and ngl’s.
- Approximately 29,000 acres (12,900 net acres) of undeveloped
land and over 130 kilometers of proprietary seismic in Point Loma’s
core area of west central Alberta.
- The Acquisition had total proved reserves of 1.6 MMboe (1.1
MMboe net) and total proved reserve net present value, discounted
at 10 percent, of $6.7 million ($4.7 million net).
- The Acquisition had estimated net operating income of $850,000
($595,000 net) during the recent six month adjustment period
(November 2017 – April 2018).
- The Acquisition has a liability management ratio (“LMR”) of
3.4, comprised of deemed assets of $11.5 million and deemed
liabilities of $3.4 million.
The properties include areas with proved
undeveloped locations booked in addition to the base production.
Full summary tables of the reserves of the Acquisition were
released in Point Loma’s March 19, 2018 press release.
Operational Update
The Thornbury area project is complete and Point
Loma production currently exceeds 1,000 boe/d with an estimated 30
percent oil and ngl mix. Further ngl production gains are expected
as Point Loma completes work to reroute existing production volumes
and reactivate previously suspended volumes to a deep cut facility
in the Paddle River area. The initial component of the project is
anticipated to be completed in May 2018 for a potential increase of
approximately 40 bpd of ngl’s with additional new volumes
restarting later in the year with accompanying ngl production.
Point Loma will also continue to evaluate all
producing wells for economic health during projected low natural
gas prices in the summer months of 2018. This may result in some
temporarily reduced production volumes, particularly natural gas,
that can resume as prices increase.
“This is another accretive acquisition in our
core area that will expand our opportunity base.” said Terry Meek,
President and CEO of Point Loma. “As we continue forward in
challenging times we feel the base we are accumulating will
position us for excellent growth in the future.”
Personnel Change
Point Loma announces the departure of Jamie
Chisholm, Vice President Operations, to a new opportunity outside
of the country, effective June 1, 2018. The Company wishes Jamie
well in his new venture and thanks him for his contribution to
Point Loma since inception.
About Point Loma
Point Loma is a public oil and gas exploration
and development company focused on conventional oil and gas
reservoirs in west central Alberta. The Company controls over
160,000 net acres (250 net sections) and has a deep inventory of
opportunities in the Mannville, Nordegg, Banff and Duvernay shale
formations. Point Loma's business plan is to utilize its experience
to drill, develop and acquire accretive assets with potential for
horizontal multi-stage frac technology and exploit opportunities
for secondary recovery. For more information, please visit Point
Loma's website at www.pointloma.ca or Point Loma's profile on
the System for Electronic Document Analysis and Retrieval website
at www.sedar.com.
For further information, please contact:
Terry Meek President and CEO Telephone: (403) 705-5051 ext.
444tmeek@pointloma.ca
Kevin Angus Vice President, New Ventures Telephone: (403)
705-5051 ext. 440kangus@pointloma.ca
Randall Boyd Vice President Finance and CFO Telephone: (403)
705-5051 ext. 443 rboyd@pointloma.ca
A Note Regarding Forward-Looking
Information
This press release contains forward-looking
statements and forward-looking information within the meaning of
applicable securities laws, including without limitation,
statements pertaining to the satisfaction of the conditions for
closing of the Acquisition; the timing of closing of the
Acquisition and whether the Acquisition will be successfully
completed; the production and reserves associated with the assets
being acquired in the Acquisition;; Point Loma’s expectations as to
future prices of oil and natural gas; the focus of Point Loma’s
management team and go-forward strategy.
The use of any of the words “will”, “expects”,
“believe”, “plans”, “potential” and similar expressions are
intended to identify forward-looking statements or information.
Although Point Loma believes that the expectations and assumptions
on which such forward-looking statements and information are based
are reasonable, undue reliance should not be placed on the
forward-looking statements and information because Point Loma
cannot give assurance that they will prove to be correct.
Since forward-looking statements and information
address future events and conditions, by their very nature they
involve inherent risks and uncertainties. Actual results could
differ materially from those currently anticipated due to a number
of factors and risks. These include, but are not limited to risks
that the conditions to closing of the Acquisition are not
satisfied, the risks associated with the oil and gas industry in
general such as operational risks in development, exploration and
production; delays or changes in plans with respect to exploration
or development projects or capital expenditures; the uncertainty of
reserve and resource estimates; the inability of Point Loma to
bring additional production on stream or in the anticipated
quantities disclosed herein; the uncertainty of estimates and
projections relating to reserves, resources, production, costs and
expenses; health, safety and environmental risks; commodity price
and exchange rate fluctuations; marketing and transportation; loss
of markets; environmental risks; competition; incorrect assessment
of the value of acquisitions; failure to realize the anticipated
benefits of acquisitions; ability to access sufficient capital from
internal and external sources; changes in legislation, including
but not limited to tax laws, royalties and environmental
regulations, actual production from the acquired assets may be
greater or less than estimates. Management has included the above
summary of assumptions and risks related to forward-looking
information provided in this press release in order to provide
security holders with a more complete perspective on Point Loma’s
future operations and such information may not be appropriate for
other purposes.
The forward-looking statements and information
contained in this press release are made as of the date hereof and
Point Loma does not undertake any obligation to update publicly or
revise any forward-looking statements or information, whether as a
result of new information, future events or otherwise, unless so
required by applicable securities laws.
Oil and Gas Information
“BOEs” may be misleading, particularly if used
in isolation. A BOE conversion ratio of six thousand cubic feet of
natural gas to one barrel of oil equivalent (6 Mcf: 1 bbl) is based
on an energy equivalency conversion method primarily applicable at
the burner tip and does not 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.
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