TORONTO, ONTARIO--(Marketwired - Sep 6, 2013) - Candax Energy Inc. ("Candax" or the "Company") (TSX:CAX), a company focused on mature oil field development in Tunisia, today announced that its subsidiary, Candax Madagascar Limited ("CML"), has finalized an agreement to sell its 10% working interest in Block 1101 in Madagascar (the "Block") to Oyster Oil & Gas Limited ("Oyster").
Upon closing, Candax will receive a cash payment of $500,000. An additional $500,000 is to be paid in a combination of cash and shares of Oyster upon the drilling of the first exploration well on the Block. Candax will continue to retain upside on the Block through a combination of contingent payments, including certain contingent future payments from Oyster of up to $3 million as well as a share of future contingent production royalties of up to $15 million from the Block Operator, Afren.
"We are very pleased to continue to retain upside in this Block's world class exploration potential while de-risking our exposure to zero," said Benoit Debray, Chairman and CEO of Candax "We look forward to seeing the operator, Afren, and Oyster move forward with the development of the block. This transaction is consistent with our strategy to focus our efforts on the development of our encouraging prospects in Tunisia."
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION AND STATEMENTS
This press release includes "forward looking statements", within the meaning of applicable securities legislation, which are based on the opinions and estimates of Management and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward looking statements.
Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "budget", "plan", "continue", "estimate", "expect", "forecast", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe" and similar words suggesting future outcomes or statements regarding an outlook. Such risks and uncertainties include, but are not limited to, risks associated with the oil and gas industry (including operational risks in exploration development and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections in relation to production, costs and expenses; the uncertainty surrounding the ability of Candax Energy Inc. to obtain all permits, consents or authorizations required for its operations and activities; and health safety and environmental risks), the risk of commodity price and foreign exchange rate fluctuations, the ability of Candax Energy Inc. to fund the capital and operating expenses necessary to achieve the business objectives of Candax Energy Inc., the uncertainty associated with commercial negotiations and negotiating with foreign governments and risks associated with international business activities, as well as those risks described in public disclosure documents filed by Candax Energy Inc. Due to the risks, uncertainties and assumptions inherent in forward-looking statements, prospective investors in securities of Candax Energy Inc. should not place undue reliance on these forward-looking statements. Statements in relation to "reserves" are deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves described can be profitably produced in the future.
Candax is an international energy company with offices in Toronto and Tunis. The Candax group is engaged in exploration and the production of oil and gas in Tunisia and holds an economic interest in an exploration permit in Madagascar.