News for E3
E3 Energy Inc. Announces Acquisition
Friday December 13, 11:32 am ET
CALGARY, ALBERTA--E3 Energy Inc. (formerly Mill City International Inc.) ("E3") (MIY-TSX Venture) is pleased to announce the acquisition of all of the shares of 997066 Alberta Ltd. ("997"), a private Alberta company, the primary asset of which is a producing natural gas property (the "Hackett Property") in E3's central Alberta main project area. E3 has acquired all of the shares of 997 in exchange for the issuance of 2 shares of E3 for every 1 share of 997, for an aggregate issuance of 3,420,004 E3 shares at an ascribed value of $0.50 per share. This acquisition satisfies the criteria for the future acquisition approved by shareholders of E3 at its October 28, 2002 shareholder meeting.
ADVERTISEMENT
997 currently has 1,710,002 shares outstanding. It acquired the Hackett Property interest recently, on September 3, 2002. This property is an operated, approximately 60% working interest in 27,270 gross (15,864 net) acres of land located approximately 100 miles northeast of Calgary, Alberta. 997 has current production from this property of 1.5 mmcf/d of natural gas and 25 bpd of NGL's for a total of 275 boe/d (6:1). An independent reserves appraisal and economic evaluation has been prepared for the Hackett Property by Gilbert Laustsen Jung Associates Ltd. dated effective July 1, 2002. 997 has estimated oil and gas reserves of approximately 374 mboe of total proved producing reserves and 414 mboe of established reserves. The Hackett Property includes 4,927 net undeveloped acres and is characterized by several infill/stepout development drilling locations, many uphole recompletion opportunities and multi-zone production. As at September 3, 2002, 997 had approximately $300
,000 in cash, debt of $1.7 million and shareholders' equity of $975,000 (audited).
E3's management believes this acquisition will provide an excellent reserve, production and cash flow base for future company growth. E3's strategy is to strive to create sustainable growth in reserves, production and cash flow per share through the execution of an integrated growth strategy of acquiring, exploiting and exploring for high-quality, long life, light oil and natural gas reserves within E3's core geographic project areas. This acquisition constitutes the first step in that strategy.
Pursuant to shareholder approval for E3's recent reorganization, as announced on October 29, 2002, the directors of E3 are now Paul Starnino, Glenn Downey, John Brussa, Kevin Bennett and Mark Naylor (as described in further detail in the June 4, 2002 press release announcing the reorganization). The directors and officers of E3, being Paul Starnino, Glenn Downey, Paul Smith, Graham Cormack, Mark Naylor, John Brussa and Kevin Bennett, collectively hold approximately 15.2% of the shares of 997. 997 is controlled by a single shareholder who holds approximately 58.5% of the shares of 997. Two related shareholders of 997 control or beneficially own approximately 76% of the shares of 997.
Upon completion of this acquisition, together with the previously-announced financing and E3's recent reorganization, it is anticipated that E3 will meet TSX Venture Exchange Tier 1 listing requirements. E3 anticipates that upon completion of this acquisition and the flow-through financing, and subject to the completion of all applicable filings with the TSX Venture Exchange, the shares of E3 will recommence trading as a Tier 1 issuer under new trading symbol "ETE".
Completion of the transaction was subject to a number of conditions, including but not limited to, Exchange acceptance and shareholder approval, which was obtained by E3's shareholders on October 28, 2002.
Investors are cautioned that, except as disclosed in the Management Information Circular dated September 23, 2002 prepared in connection with the reorganization of E3, and the Filing Statement to be filed in connection with the transaction, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of E3 should be considered highly speculative. |
