CALGARY, ALBERTA--(Marketwire - March 1, 2012) - Pine Cliff Energy Ltd. (Pine Cliff) (www.pinecliffenergy.com) (TSX VENTURE:PNE.V - News) is pleased to announce that it has closed the previously announced acquisition (the "Acquisition") of certain oil and natural gas assets in the Carrot Creek area in the Province of Alberta (the "Carrot Creek Assets") for cash consideration of $23.5 million. The effective date for the Acquisition is January 1, 2012.
The Acquisition was financed by: (i) a $15 million revolving demand credit facility with Alberta Treasury Branches (the "Credit Facility"); (ii) a $7 million short-term secured loan from a related party (the "Related Party Loan"); and (iii) Pine Cliff's working capital. The Credit Facility is secured against all of the assets of Pine Cliff and is subject to review on an annual basis. The Related Party Loan has a term of six months, is subordinated to the Credit Facility and bears interest at a rate of 5 percent per annum, payable monthly.
As previously disclosed, the Carrot Creek Assets have current estimated production of 950 barrels of oil equivalent (BOE) per day, of which approximately 23 percent consists of oil and natural gas liquids and 77 percent consists of natural gas. In addition to the producing assets, Pine Cliff will acquire 15.3 net sections of prospective land, some of which has current vertical production. Pine Cliff anticipates that this land has multi-zone potential which can be further exploited using horizontal drilling technology. Pine Cliff has also negotiated preferential pricing for processing a portion of its natural gas and liquids production at a gas plant owned and operated by the vendor of the Carrot Creek Assets.
Pine Cliff is focused on building a portfolio of high return assets to generate long-term value and returns for shareholders. Pine Cliff believes that this Acquisition will assist in achieving such future high returns. The company anticipates that it will continue to maintain a strong balance sheet, drill oil and high liquid gas wells in the near-term and continue to pursue property acquisitions.
Pine Cliff trades on the TSX Venture Exchange under the symbol PNE.
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Special Note Regarding Forward-Looking Information
This press release contains certain statements or disclosures relating to Pine Cliff that are based on the expectations of Pine Cliff as well as assumptions made by and information currently available to Pine Cliff which may constitute forward-looking information under applicable securities laws. All such statements and disclosures, other than those of historical fact, which address activities, events, outcomes, results or developments that Pine Cliff anticipates or expects may, or will occur in the future (in whole or in part) should be considered forward-looking information. In some cases, forward-looking information can be identified by terms such as "forecast", "future", "may", "will", "expect", "anticipate", "believe", "potential", "enable", "plan", "continue", "contemplate", "pro-forma", or other comparable terminology. In particular, this press release makes reference to Pine Cliff's corporate goals and strategy, the anticipated benefits of the Acquisition, crude oil reserve and resource volumes associated with the properties to by acquired, expected production from the properties to be acquired pursuant to the Acquisition and timing of exploration and production activities. Readers are cautioned that there is no assurance that the matters referenced herein will proceed as set forth herein. Many factors could cause the performance or achievement by Pine Cliff to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. These factors include the failure to achieve Pine Cliff's anticipated goals and strategies and the anticipated benefits of the Acquisition. Readers are cautioned that the foregoing list of factors is not exhaustive. Statements relating to "reserves" or "resources" are deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves and resources described can be profitably produced in the future. The forward-looking statements contained in this press release are expressly qualified by this cautionary statement. Pine Cliff is not under any duty to update any of the forward-looking statements after the date of this press release or to conform such statements to actual results or to changes in Pine Cliff's expectations and Pine Cliff disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
- TSX Venture Exchange