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NEWS OUT! New Zealand and Australian oil and gas interests to be acquired CVL Resources Ltd CVL Shares issued 13,411,000 Apr 30 close $0.74 Thu 1 May 97 News Release Mr Ian Rozier reports The company has reached an agreement to acquire interests in advanced oil and gas exploration permits in Australia, as well as interests in a joint venture in New Zealand. The permits cover more than 37,000 sq km in the Cooper/Eromanga, and Surat/Bowen Basins in Queensland, Australia, the Oaklands Graben area of New South Wales, and in the East Coast Basin, North Island, New Zealand. Several years ago, the Queensland government forced Santos Ltd to relinquish large permit areas in the Cooper/Eromanga Basin oil and gas producing area that had been locked up for years. These areas were snapped up by a handful of companies including Tyers Petroleum Pty Ltd and its partners, M.I.M., Inland Oil, and US owned Discovery Geosciences Corp. It is the interests of Tyers and its partners that have been acquired by CVL. The Cooper/Eromanga Basin is Australia's most prolific onshore hydrocarbon producing basin and is considered to be the most prospective for further oil and gas discoveries. The permits acquired in the Cooper/Eromanga Basin area are ATP-539-P, ATP-590-P and ATP-618-P covering an area totalling over 24,000 sq km. The Exxon/Santos group is the leading producer in the area. Two of the permits acquired are adjacent to an Exxon/Santos permit that contains 5.4 tcf of sales gas, 430 million STB of condensate and gas liquids, and 140 million STB of recoverable oil. The main focus will be on the permits in the Cooper/Eromanga Basin area where drill targets have already been identified in the same geological horizons and along similar structures responsible for major discoveries on adjacent permits. A well immediately to the east of the boundary to permit ATP-539-P flowed at 1,650 bopd, one to the south flowed at 3,255 bopd, and a well to the north of ATP-618-P flowed at 5,000 bopd. Recently, Maple Oil paid A$32 million for a 40% interest in another adjoining block in the Cooper/Eromanga area and a major discovery has been made close to the boundary of one of the acquired permits. Exxon is reported to have paid US$690 million for a 25% working interest in its block. The company is confident that the acquisition of the acquired interests will reflect similar valuations for the company as the enormous potential that exists in these permits is realized. The company has also acquired interests in some extremely prospective permits in the Surat/Bowen Basin in Queensland, Australia's onshore oil and gas productive basin. These permits, being ATP-552-P, ATP-595-P, ATP-603-P, cover a total area of over 5,000 sq km and are also located close to existing oilfields. Infrastructure in both the Cooper/Eromanga, and the Surat/Bowen Basin permits is excellent, with several pipelines traversing some of the permit areas, or running very close to others. Road access is excellent. The company will also be acquiring a 50% interest in a permit in the Oaklands Graben area, northeast of Melbourne in New South Wales, Australia. As part of the acquisition, the company will additionally acquire a 50% interest in an application for an exploration area in the southern part of the East Coast Basin in New Zealand in joint venture with GEL Exploration Inc of Dallas, Texas. The company will form a Barbados subsidiary to hold the interests acquired. This company will acquire the shares of an Australian oil and gas company that will hold all the rights and titles to the interests. The total consideration to be paid will be A$4.25 million and the issuance of 12 million shares of the company that will be subject to a one year hold period. The value of the shares is deemed to be C$0.60. The total value of the consideration to be paid is C$11.5 million. A finder's fee will not apply in this transaction. The company currently has 13.7 million shares issued and outstanding, with $6 million in treasury. With all outstanding warrant and options being exercised the company would have a fully diluted cash position of $11 million. The completion of the transaction is subject to the company obtaining an independent evaluation of the assets and completing a financing of a least $20 million. A regional office will be set up in Brisbane, Australia to service these projects. Oil and gas exploration in Australia will be an integral part of the long term corporate plan for the company. (c) Copyright 1997 Canjex Publishing Ltd. canada-stockwatch.com CVL Resources Ltd CVL Shares issued 13,411,000 Apr 30 close $0.74 Fri 2 May 97 Resume Trading Effective at 11:00 am, May 2 1997, trading will resume, an announcement having been made. (c) Copyright 1997 Canjex Publishing Ltd. canada-stockwatch.com | ||||||||||||||
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