(TSX-V | OYL)
TORONTO, July 23, 2013 /CNW/ - CGX Energy Inc. (TSX-V - OYL) announced today the release of its unaudited consolidated financial results for the quarter ended June 30, 2013, together with its Management Discussion and Analysis. These documents will be posted on the Company's website at www.cgxenergy.com and SEDAR at www.sedar.com.
Second Quarter 2013 Overview and Highlights
- CGX Energy reported a net loss of loss of $8,548,852 or $0.13 per share for the three month period ended June 30, 2013, compared with a net loss of $94,093,285 or $2.88 a share for the same period in 2012.
- Cost Cutting Initiatives: With the exception of items relating to the special committee process that was undertaken and the change of control payments made due to the investment by Pacific Rubiales Energy Corp. ("Pacific Rubiales"), the Company's general and administration costs decreased in the second quarter due to a reduction in all non-essential purchases and travel. The Company will continue to evaluate further cost cutting initiatives and is determined to keep general and administrative costs at current or lower levels going forward. As at June 30, 2013, the Company's working capital increased to $13,361,347 from a working capital deficiency of $12,650,761 as at December 31, 2012.
- Private Placement Financing: On April 26, 2013, the Company closed a brokered private placement raising CDN $37,008,900 by issuing 37,008,900 post-consolidation units (the "Units") at a price of CDN $1.00 per Unit. Each Unit was comprised of one post-consolidation common share in the capital of the Company and one post-consolidation common share purchase warrant. Each post-consolidation common share purchase warrant entitles the holder thereof to acquire one post-consolidation common share at any time until April 26, 2018 at an exercise price of CDN $1.70. In connection with the private placement, the Company's board of directors and its senior management team have been changed.
- Share Consolidation: At the Company's Annual and Special Meeting of shareholders held on June 26, 2013, the shareholders approved a consolidation of its issued and outstanding common shares, warrants and options on a basis of 10 pre-consolidated shares, warrants or options for each post-consolidation share, warrant or option. On July 11, 2013, the Company filed articles of amendment to complete this consolidation.
- Strategic Partners and New Initiatives: As of March 19, 2013 and effective December 31, 2012, an Independent Resources Evaluation was completed by DeGolyer and MacNaughton of Dallas, Texas, USA (the "D&M Report"). In the D&M Report, the total best estimate (P50) of Prospective Resources for six oil and gas prospects within the Corentyne PA are 779 MMbbl of oil, 743 MMbbl of condensate, 6,943 Bcf of sales gas plus 696 billion cubic feet of solution gas. The Company is now in the process of re-interpreting seismic data to define the next prospect to be drilled on the Corenytne PPL with the assistance of Pacific Rubiales and its technical staff. In the short term, the Company will likely require additional equity financing and will seek to widen its shareholder base with a view to longer term farm-out transactions to enhance shareholder value.
About CGX Energy
CGX Energy is a Canadian-based oil and gas exploration company focused on the exploration of oil in the Guyana-Suriname Basin.
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.
This press release contains forward-looking statements. Forward-looking statements are frequently characterized by words such as "plan", "expect", "project", "intend", "believe", anticipate", "estimate", "may", "will", "would", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur in the future. These forward-looking statements are based on certain key expectations and assumptions made by CGX. CGX believes the expectations and assumptions on which it develops forward-looking statements are reasonable; however, undue reliance should not be placed on forward-looking statements as there can be no assurance they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. In addition, other risks that may affect the forward-looking statements in this press release are outlined further in the Company's Annual Information Form dated June 10, 2013 filed on SEDAR at www.sedar.com.
The forward-looking statements contained in this press release are made as of the date hereof and CGX undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
Readers should give attention to the estimates of individual classes of resources and appreciate the differing probabilities of recovery associated with each class. Estimates of remaining recoverable resources (unrisked) include Prospective Resources that have not been adjusted for risk based on the chance of discovery or the chance of development and Contingent Resources that have not been adjusted for risk based on the chance of development. It is not an estimate of volumes that may be recovered. Actual recovery is likely to be less and may be substantially less or zero.
Prospective Resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective Resources have both an associated chance of discovery and a chance of development. Prospective Resources are further subdivided in accordance with the level of certainty associated with recoverable estimates, assuming their discovery and development, and may be sub-classified based on project maturity. There is no certainty that any portion of the resources will be discovered. If discovered, and they would be technically and economically viable to recover; there is no certainty that the Prospective Resource will be discovered. If discovered, there is no certainty that any discovery will be technically or economically viable to produce any portion of the resources.
SOURCE CGX Energy Inc.