Crown Point Announces Strategic Acquisition of Exploitation Concessions in Santa Cruz, Argentina
? Acquisition will increase significantly Production and Reserves ?
? Agreements Signed to acquire Petroleum Exploitation Concessions Piedra Clavada and Koluel Kaike ?
CALGARY, Alberta, Feb. 09, 2024 (GLOBE NEWSWIRE) -- Crown Point Energy Inc. (TSX-V: CWV) ("Crown Point" or the "Company") is pleased to announce that its wholly-owned subsidiary, Crown Point Energia S.A., has entered into an asset sale and purchase agreement (the "Acquisition Agreement"), dated as of February 1, 2024, with PAN AMERICAN ENERGY S.L., SUCURSAL ARGENTINA (the "Seller"), an arm's length party, to acquire all of Seller's right, title and interest in the Piedra Clavada and Koluel Kaike hydrocarbons exploitation concessions.
Acquired Assets
The Company will acquire from the Seller a 100% operating interest in Piedra Clavada and Koluel Kaike blocks located in the Santa Cruz Province, on the southern flank of Golfo San Jorge basin, approximately 200 km southwest of Comodoro Rivadavia (the "Santa Cruz Concessions").
This acquisition represents an excellent opportunity for the Company to acquire a 100% operated interest in already producing oil assets in Argentina and with an average daily production level of 3,500 bbl/d during the three month period ended December 31, 2023.
The Santa Cruz Concessions, comprising a total of 71,593 acres, will include Company owned extensive infrastructure in place capable of handling larger than current production volumes.
The purchase price payable by Crown Point to the Seller is US$12,000,000 cash base consideration, subject to customary closing adjustments, plus certain contingent in-kind consideration that is payable throughout a fifteen-year period following the closing date.
With respect to the in-kind consideration, Crown Point will deliver to the Seller a monthly quantity of oil produced from the Santa Cruz Concessions that may range from zero up to 600 bbl/d, subject to the oil market price so determined for each month.
Crown Point intends to fund the base cash portion of the purchase price using its existing cash resources, operating cash flows, and by completing a debt and/or equity financing prior to closing of the acquisition.
Acquisition Agreement
Completion of the acquisition is subject to, among other things, the receipt of all necessary regulatory and Provincial approvals, including the approval of the TSX Venture Exchange ("TSXV"), and other customary closing conditions. Completion of the acquisition is not subject to approval by the Company's shareholders. The acquisition is expected to close in April 2024. The effective date of the acquisition is January 1, 2024.
On February 1, 2024, the common shares of the Company (the "Common Shares") were halted pending review of the Acquisition Agreement pursuant to TSXV Policy 5.3 ? Acquisitions and Dispositions of Non-Cash Assets ("Policy 5.3") as the matters contemplated by the Acquisition Agreement are considered to be a "Fundamental Acquisition" under Policy 5.3. Trading of the Common Shares will remain halted pending receipt by the TSXV of acceptable documentation pursuant to Policy 5.3.
For inquiries please contact:
| Gabriel Obrador | Marisa Tormakh |
| President & CEO | Vice-President, Finance & CFO |
| Ph: (403) 232-1150 | Ph: (403) 232-1150 |
| Crown Point Energy Inc. | Crown Point Energy Inc. |
| [email protected] | [email protected] |
About Crown Point
Crown Point is an international oil and gas exploration and development company incorporated in Alberta, Canada, trading on the TSX Venture Exchange and operating in Argentina. Crown Point's exploration and development activities are focused in three producing basins in Argentina, the Austral basin in the province of Tierra del Fuego, and the Neuquén and Cuyano basins in the province of Mendoza. Crown Point has a strategy that focuses on establishing a portfolio of producing properties, plus production enhancement and exploration opportunities to provide a basis for future growth.
Advisories
Forward-Looking Statements. Certain information regarding Crown Point set forth in this document, including all details regarding the proposed acquisition of the Seller's right, title and interest in the Piedra Clavada and Koluel Kaike exploitation Concessions; the opportunities the acquisition presents; the benefits that we anticipate deriving from the acquisition; the in-kind consideration and the volumes of oil to be delivered to the Seller at different average oil prices and in different years; our beliefs regarding how we will fund the purchase price for the acquisition and our ability to fund the purchase price for the acquisition; including our ability to obtain the requisite debt and/or equity financing; and the anticipated timing for closing the acquisition. The forward-looking information is based on certain key expectations and assumptions made by Crown Point, including expectations and assumptions concerning: the timing of receipt of the necessary regulatory; stock exchange and other approvals and the satisfaction of and time necessary to satisfy the conditions to the closing of the acquisition; prevailing commodity prices and exchange rates; applicable royalty rates and tax laws; future well production rates and reserve volumes; the timing of receipt of regulatory approvals; the performance of existing wells; the success obtained in drilling new wells; the sufficiency of budgeted capital expenditures in carrying out planned activities; and the availability and cost of labour and services. In addition, there are no assurances the acquisition will be completed on the terms disclosed herein or at all. Although Crown Point believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because Crown Point can give no assurances that they will prove to be correct. Since forward-looking information addresses future events and conditions, by its very nature it involves inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These risks include, without limitation: risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation; loss of markets; volatility of commodity prices; environmental risks; inability to obtain drilling rigs or other services; capital expenditure costs, including drilling, completion and facility costs; unexpected decline rates in wells; wells not performing as expected; delays resulting from labour unrest; delays resulting from our inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources; the impact of general economic conditions in Canada, Argentina, the United States and overseas; industry conditions; changes in laws and regulations (including the adoption of new environmental laws and regulations) and changes in how they are interpreted and enforced; increased competition; the lack of availability of qualified personnel or management; fluctuations in foreign exchange or interest rates; and stock market volatility and market valuations of companies with respect to announced transactions and the final valuations thereof. There are also risks inherent in the nature of the proposed acquisition, including failure to realize anticipated opportunities and benefits; risks regarding the integration of assets into Crown Point; incorrect assessment by Crown Point of the value of the assets; failure to obtain the required regulatory and other third party approvals; failure to obtain the debt and/or other financing required to fund the purchase price for the acquisition; and the possibility that the asset sale and purchase agreement will be terminated. Readers are cautioned that the foregoing list of factors is not exhaustive.
Crown Point's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward looking statements will transpire or occur, or if any of them do so, what benefits that the Company will derive therefrom. Additional information on these and other factors that could affect Crown Point's operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com) or Crown Point's website (www.crownpointenergy.com). The forward-looking statements contained in this document are made as at the date of this news release and Crown Point does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.
Oil and Gas Matters. "bbl/d" means barrel per day.
Neither 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 news release.
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