CALGARY, June 1, 2016 /CNW/ - LGX Oil + Gas Inc.
("LGX", or the "Company") (TSXV: OIL) announces that the
Company's lender will file an application with the Court of Queen's
Bench of Alberta to place the
Company into Receivership and appoint Ernst & Young Inc. as
Receiver to manage the Company's affairs (the "Receiver"). The
application is anticipated to be heard in Court on Tuesday, June 7, 2016 at 11:00 a.m. (MST) and it is expected the Court
will grant the application. The Receiver will be charged with
managing the day to day affairs of the Company during the period of
appointment and should be contacted with respect to any questions
concerning the assets and liabilities of LGX. Commencing at market
open June 2, 2016 the Company's
shares will resume trading.
LGX's daily operations, financial position and strategic
alternative process have been significantly disrupted and impacted
due to LGX's Manyberries property
being subject to an Emergency Order for the Protection of the
Greater Sage-Grouse pursuant to the Species at Risk Act
(Canada) ("Emergency Order") which
came into effect on February 18, 2014
to address the imminent threats to the survival and recovery of the
Greater Sage-Grouse. This was the first and only time that an
Emergency Order has been issued under the Species at Risk
Act (Canada), even though the
legislation has been in existence since 2002.
Due to the extreme limitations to LGX's development and
operational activities, the Emergency Order has had a significant
adverse effect on LGX's ability at Manyberries to maintain and increase
production and drill new wells that may result in potential
revisions to the reserves attributable to the Manyberries property in any future estimate of
such reserves.
In December 2015, the Company and
its working interest partners brought a claim against the Attorney
General of Canada seeking
compensation in the amount of $60
million for the de facto expropriation and injurious
affection of their working interests in the oil and gas assets in
the Manyberries oilfields that are
affected by the Emergency Order, SOR/2013-202 published in Part II
of the Canada Gazette on December 4,
2013.
LGX has been unable to secure additional financing or sell the
Manyberries property due to the
pervasive ramifications of the Emergency Order. Any operating
guidelines developed to-date by Environment Canada are far from
being comprehensive, transparent and reliable and the Company does
not believe satisfactory resolution will be forthcoming.
However, the Company continues to operate its Manyberries property in accordance with the
prohibitions of the Emergency Order and is in compliance with the
Alberta Energy Regulator rules, regulations and requirements.
Therefore, as the Company is unable to repay the demanded debt
of $31.3 million by June 10, 2016, compounded by the systemic damage
of the Emergency Order, the Company's Board of Directors has
decided not to oppose the appointment of the Receiver and have
resigned effective immediately upon the appointment of the
Receiver. As a result, the Annual General and Special Meeting of
Shareholders scheduled for June 30,
2016 is cancelled.
Neither the TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Reader Advisory and Note Regarding Forward Looking Information
Certain statements contained within this press release, and in
certain documents incorporated by reference into this document
constitute forward looking statements. These statements relate to
future events or future performance. All statements, other than
statements of historical fact, may be 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 expressions. These
statements involve known and unknown risks, uncertainties and other
factors that may cause actual results or events to differ
materially from those anticipated in such forward looking
statements.
In particular, this press release contains the following forward
looking statements pertaining to, without limitation, the
following: (i) LGX' ability to repay the debt; (ii) whether the
Court will grant the Receivership Application; and (iii) the
anticipated timing of the Receivership application hearing.
Readers are cautioned that the foregoing lists of factors are
not exhaustive. The forward looking statements contained in this
press release and the documents incorporated by reference herein
are expressly qualified by this cautionary statement. The forward
looking statements contained in this press release speak only as of
the date thereof and LGX does not assume any obligation to publicly
update or revise them to reflect new events or circumstances,
except as may be required pursuant to applicable securities
laws
SOURCE LGX Oil + Gas Inc.