Maybe this time??
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Derek Resources Corporation DRS
Shares issued 4,700,000 Mar 20 close $0.93
Tue 21 Mar 2000 News Release
Mr. Barry Ehrl reports
Derek Resources has concluded negotiations for financing of 6.0-million (Canadian) to finance the installation of an initial production well and steam generating facility at its LAK Ranch Oil project. The company has agreed to issue up to eight million units at a price of 75 Canadian cents each. The share purchase warrants associated with the units will be exercisable at a price of $1.00 (Canadian) in year one and $1.25 (Canadian) in year two. Proceeds from these placements will be held by an escrow agent until closing occurs.
In the prolific Powder River basin of eastern Wyoming, U.S., the LAK Ranch is estimated to contain 100 plus million barrels of high quality oil. Oil produced from this field is seen being sold at a price equivalent to the undiscounted West Texas Intermediate benchmark. Using steam assisted gravity drainage (SAGD) technology recently developed in Canada, the company intends to prove that a significant portion of the oil contained at LAK Ranch is recoverable at a very favourable cost per barrel. Masefield AG of Zug, Switzerland, has committed $500,000 (U.S.) to this financing. Masefield is an international energy company specializing in the trade of crude oil, petroleum products and petroleum backed financial instruments. Their annual turnover exceeds $1.0-billion (U.S.) yearly. Masefield will become a strategic partner with the company and will assist with the marketing and price risk management and price risk management of future production and will also provide expansion capital when required and appropriate.
Bateman Engineering Inc. of South Africa has committed $250,000 (U.S.) to this financing. Bateman is an international engineering firm with expertise in the engineering, procurement and construction of industrial facilities around the world. Their expertise extends to the fields of mining, oil and gas production and processing and electrical cogeneration. Bateman?s office at Denver, Colo., will provide project management services for the initial and later stages of oil production at the LAK Ranch. Various private investors, senior oil executives and investment banks in Europe and North America have committed the balance of this financing. Many investors have carried out due diligence procedures on their own behalf prior to making their commitments. The due diligence procedures included reviews of technical data, property data and reserve estimates. In some cases, minor due diligence procedures remain to be completed. Most of the private placements comprising this financing are subject to a commission of 6 per cent. These commissions are payable to several different financial contacts, each of which have acted as finders and assisted the company in making these private placements. These commissions may be paid in cash or units of the offering, at the discretion of the payee.
All of the above private placements and the commissions payable thereon will be subject to the rules of the Canadian Venture Exchange and the British Columbia Securities Commission.
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