AI assistant
CYCLIQ GROUP LTD — Capital/Financing Update 2012
Sep 19, 2012
64746_rns_2012-09-19_06e023fb-b76a-4695-8af0-dea8fcc60c32.pdf
Capital/Financing Update
Open in viewerOpens in your device viewer
==> picture [146 x 42] intentionally omitted <==
20 September 2012
Australian Securities Exchange Limited 2 The Esplanade PERTH WA 6000
SPRINT ENERGY SIGNS AGREEMENT FOR UP TO 70% OF 13MBBL INDICATIVE RECOVERABLE RESERVES IN PENZA REGION, RUSSIA
Key points:
-
Sprint Energy to acquire up to 70% interest in Burtasi Oil which holds 100% of the Shatkinsky and Pionersky oil and gas licenses in the prolific VolgaUral Basin, Penza Region, Russian Federation;
-
The Shatkinsky and Pionersky licenses have six, seismically mapped and near drill-ready prospects, with a total of 71mmbbls OOIP (original oil in place) or 13mmbbls, P50 indicative recoverable reserves, from the same formations as those currently producing in adjacent oil producing fields in the Carboniferous and Devonian carbonates.
-
Sprint granted 90 day exclusivity period, for US$250,000 to allow time for due diligence and to secure the opportunity.
-
Sprint to pay US$1M on signing a formal purchase and Joint Operating Agreement (JOA) on or before the end of the 90 day exclusivity period.
-
Upon signing and committing to Phase One, Sprint to earn 30% of Burtasi Oil through funding G & G, and 50km 2D seismic on each block for an estimated cost of US$650,000 and assumes operatorship under a JOA.
-
Proceed to Phase Two by committing to funding the drilling of one or two well(s) estimated to cost up to US$3.5M to approximately 1850m, before 1 May 2016 for the remaining 40% (drilling can be brought forward depending on new geological data from Phase One and corporate strategies).
Australian based resource company Sprint Energy Limited (ASX: SPS) (“Sprint” or the “Company”) is pleased to announce it has signed a Heads of Agreement (HOA) with Burtasi Oil through its Australian agents, Petroscope Pty Ltd, herein after called (“Burtasi”) to acquire up to 70% interest in Burtasi Oil, who is the 100% holder of two
Sprint Energy Ltd 1186 Hay Street West Perth WA 6005 P +61 8 9215 4200 F +61 8 9215 4299 www.sprintenergy.com.au
==> picture [145 x 43] intentionally omitted <==
highly prospective licenses called Shatkinsky and Pionersky in the prolific VolgaUrals Basin, Penza Region, Russian Federation.
The Heads of Agreement (HOA) provides for a 90 day exclusivity period to Sprint to conduct its due diligence on the licenses for a non-refundable deposit of US$250,000, followed by signing of Phase one formal purchase and joint operating agreement.
Under the HOA, Sprint will pay 100% of the cost of the initial geology and geophysics, office costs & administration (as operator), 2D seismic acquisition, processing and interpretation earning a 30% interest in Burtasi Oil.
Sprint (though Burtasi Oil) will operate the licenses and will engage Petroscope Pty Ltd as its technical team leader and administrators with local Russian management and operational delivery though its office in Penza
The licenses are current and expire 1 May 2017, with G & G and seismic preceding the drilling phase, although if so warranted, drilling may be brought forward from 2016/17 if the company decides, based on technical merit and outcomes of Phase One work program.
By paying 100% of Phase two earn in costs through drilling one or two well(s) to an approximate depth of 1850m on the de-risked prospects identified during the first work phase, Sprint will earn an additional 40% interest (total of 70% interest) in Burtasi Oil.
If Sprint decides not to proceed to Phase two and the commitment to well(s) is not drilled, Sprint walks away retaining only 30% in Burtasi Oil.
The highly prospective Shatkinsky and Pionersky licenses (31km[2 ] and 87km[2] ) contain within them six (6) structurally mapped prospects on previous soviet era seismic data which are near drill ready subject to de-risking by modern 2 (or 3) D seismic data acquisition, processing and interpretation.
Based on the current available data Burtasi Oil have identified a total of 71mmbbls OOIP (original oil in place) or 13mmbbls, P50 indicative recoverable reserves, from the same formations as those currently producing in adjacent oil producing fields in the Carboniferous and Devonian carbonates and such oil fields are less than 6km from the Burtasi Oil license boundary.
The Licenses are located close to major infrastructure, pipelines and markets. Produced Oil from the area attracts world parity pricing WTI less 10% and the fiscal regime is favourable to business
Page 2 of 5
==> picture [145 x 43] intentionally omitted <==
Burtasi Oil, with Sprint at the helm, will remain the operator of Shatkinsky and Pionersky throughout the period of the earn in Phases and beyond. Burtasi Oil is fully carried throughout the current license term and work programs.
Sprint Energy Managing Director; Brad Boyle said “The ability to earn in to Burtasi Oil (holder of the Shatkinsky and Pionersky Licenses) is an important opportunity for the Company and demonstrates the company’s ability to attract significant projects and deal flow in this region. Sprint’s entry into the Volga-Ural Basin, the preeminent oil and gas producing basin in the Russian Federation is in line with our corporate strategy to develop a diversified energy portfolio including near and long term conventional oil and gas production and unconventional gas exploration in the Russian Federation.“
“We’re excited about working with Burtasi Oil, whose principals have a well developed local Russian network and will facilitate doing business through ensuring more deal flow and access to quality projects,” Mr Boyle said.
Shatkinsky and Pionersky are located in an established area with high oil and gas production close to pipelines, roads, refineries, railroads and markets. The area is accessible all year round and there are well established service providers in the local area thus reducing the cost of operations
“This acquisition opportunity significantly enhances our asset portfolio which includes international oil and gas exploration and development licenses in the USA and West Siberia (Tomsk Project currently under option). In addition to their conventional oil and gas potential the areas in Russia are an emerging unconventional gas region that includes coal seam gas, shale gas and stratigraphic accumulations. The Company’s forward work program will consider and potentially pursue these opportunities in the near term.” Mr Boyle said.
Page 3 of 5
==> picture [145 x 43] intentionally omitted <==
==> picture [206 x 200] intentionally omitted <==
==> picture [197 x 200] intentionally omitted <==
Figure 1: Location of the Volga-Ural Basin, Penza Region, Russia.
Yours sincerely Sprint Energy Ltd
Brad Boyle Managing Director Phone: +61 8 9215 4200 Mobile: +61 417 175 852 Email: [email protected]
For more information please contact:
Mr Brad Boyle Jon Roestenburg BSc, GBQ, MLM, CC Managing Director Director Sprint Energy Pty Ltd Petroscope Pty Ltd Tel: +61 8 9215 4200 Tel: +61 1300793942 Email: [email protected] Email: [email protected]
Website: www.sprintenergy.com.au
About Sprint Energy Ltd: Sprint Energy Ltd is an independent oil and gas exploration and production Company, listed on the Australian Stock Exchange (ASX Code: SPS). Its primary focus of operations is Gulf Coast, USA and Russia.
Page 4 of 5
==> picture [145 x 43] intentionally omitted <==
Competent Person Statement:
The information in this announcement, which relates to indicative recoverable reserves and original oil in place is based on information compiled and peer reviewed by Mr Jon W Roestenburg who is a member of the Australian Institute of Geoscientists (AIG). Mr Roestenburg is a director and principle geoscientist of Petroscope Pty Ltd, an Oil and Gas Business Development Group and Consultancy. Mr Roestenburg has over 35 years of mineral and petroleum experience involving technical, managerial and corporate roles. In the global petroleum industry Mr Roestenburg’s operational, technical and leadership competencies extend across a number of different cultures and languages and business environments. Mr Roestenburg has worked in large, multi-national oil corporations such as Mobil Oil and Schlumberger with experience in onshore USA, Central Asia, China, Japan, Southeast Asia and Australasia. He is recognised in the industry as an individual with specialist competencies in Petroleum Geoscience. He is a financial member of the Australian Institute of Geoscientists and a life member of the American Association of Petroleum Geologists.
Forward-Looking Statements:
This document may include forward-looking statements. Forward-looking statements include, but are not necessarily limited to, statements concerning Sprint Energy Limited’s planned exploration program and other statements that are not historic facts. When used in this document, the words such as “could”, “plan”, “estimate” “expect”, “intend”, “may”, “potential”, “should” and similar expressions are forward-looking statements. Although Sprint Energy Limited believes that its expectations reflected in these are reasonable, such statements involve risks and uncertainties, and no assurance can be given that actual results will be consistent with these forwardlooking statements.
Page 5 of 5