Pacific Rubiales closes CGX Energy private placement financing and appoints new board of directors and management team
TORONTO, April 29, 2013 /PRNewswire/ - Pacific Rubiales Energy Corp. (TSX: PRE; BVC: PREC; BOVESPA: PREB) is pleased to announce the closing of the CGX Energy Inc. (TSXV: OYL) ("CGX Energy") private placement financing on April 26, 2013. The Company subscribed for 350 million units ("Units") at a price of Cdn.$0.10 per Unit for an aggregate price of Cdn.$35 million. Each Unit is comprised of one common share in the capital of CGX and one whole common share purchase warrant of CGX with an exercise price of Cdn.$0.17.
As a result of the private placement, Pacific Rubiales owns approximately 63% of the issued and outstanding common shares in the capital of CGX Energy on a non-diluted basis and approximately 75% on a fully-diluted basis. The board of directors of CGX Energy is comprised of eight directors of which Pacific Rubiales has nominated five directors - being Ronald Pantin, Serafino Iacono, José Francisco Arata, Marino Ostos and Dennis Mills. The new board of directors of CGX has appointed Serafino Iacono as Co-Chairman, Dewi Jones as Chief Executive Officer and Michael Galego as General Counsel and Secretary.
Ronald Pantin, Chief Executive Officer of Pacific Rubiales, commented: "This investment will allow us to expand and deepen the Company's position in the highly prospective offshore Guyana oil play. We consider CGX Energy's large acreage position in Guyana to be a premier world-class exploration asset in an offshore basin with analogous geology to West Africa, Brazil and Venezuela.
"On the Corentyne Block, DeGolyer and MacNaughton in a resource report for CGX Energy effective December 31, 2012, estimated mean Prospective Resources of 1,522 MMbbl of liquid hydrocarbons (779 MMbbl of oil and 743 MMbbl condensate) and 7,889 Bcf of non-associated and associated natural gas, contained in six exploration opportunities. Additionally, the USGS in its report entitled "Assessment of Undiscovered Conventional Oil and Gas Resources of South America and Caribbean, 2012" calculated 12,494 MMboe and 18,284 Bcf of yet to find oil and gas, respectively, for the Guyana-Suriname basin. Both reports emphasized the great upside exploration potential of this basin.
"This investment is well-aligned with the Company's technical strengths, strategy of early stage large resource capture and objective of building the leading Latin American independent explorer and producer of hydrocarbons."
Pacific Rubiales, a Canadian company and producer of natural gas and crude oil, owns 100% of Meta Petroleum Corp., which operates the Rubiales, Piriri and Quifa heavy oil fields in the Llanos Basin, and 100% of Pacific Stratus Energy Colombia Corp., which operates the La Creciente natural gas field in the northwestern area of Colombia. Pacific Rubiales has also acquired 100% of PetroMagdalena Energy Corp., which owns light oil assets in Colombia, and 100% of C&C Energia Ltd., which owns light oil assets in the Llanos Basin. In addition, the Company has a diversified portfolio of assets beyond Colombia, which includes producing and exploration assets in Peru, Guatemala, Brazil, Guyana and Papua New Guinea.
The Company's common shares trade on the Toronto Stock Exchange and La Bolsa de Valores de Colombia and as Brazilian Depositary Receipts on Brazil's Bolsa de Valores Mercadorias e Futuros under the ticker symbols PRE, PREC, and PREB, respectively.
Cautionary Note Concerning Forward-Looking Statements
This press release contains forward-looking statements. All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements regarding estimates and/or assumptions in respect of production, revenue, cash flow and costs, reserve and resource estimates, potential resources and reserves and the Company's exploration and development plans and objectives) are forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the Company based on information currently available to the Company. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on, the Company. Factors that could cause actual results or events to differ materially from current expectations include, among other things: uncertainty of estimates of capital and operating costs, production estimates and estimated economic return; the possibility that actual circumstances will differ from the estimates and assumptions; failure to establish estimated resources or reserves; fluctuations in petroleum prices and currency exchange rates; inflation; changes in equity markets; political developments in Colombia, Peru, Guatemala, Brazil, Papua New Guinea or Guyana; changes to regulations affecting the Company's activities; uncertainties relating to the availability and costs of financing needed in the future; the uncertainties involved in interpreting drilling results and other geological data; and the other risks disclosed under the heading "Risk Factors" and elsewhere in the Company's annual information form dated March 13, 2013 filed on SEDAR at www.sedar.com. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.
All dollar amounts in this news release are expressed in U.S. dollars ($), unless otherwise stated.
This news release was prepared in the English language and subsequently translated into Spanish and Portuguese. In the case of any differences between the English version and its translated counterparts, the English document should be treated as the governing version.
Boe's may be misleading, particularly if used in isolation. The Colombian standard is a boe conversion ratio of 5.7 Mcf:1 bbl and is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
Prospective Resources are those quantities of oil and gas estimated to be potentially recoverable from undiscovered accumulations. There is no certainty that the Prospective Resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the Prospective Resources. Application of any geological and economic chance factor does not equate Prospective Resources to Contingent Resources or reserves.
SOURCE Pacific Rubiales Energy Corp.