Crown Point Makes Economic Offer for Chañares Herrados Concession
28 December 2020 - 11:30PM
(TSX-V:CWV)
: Crown Point Energy Inc. ("Crown
Point" or the "Company") announces that the Province of Mendoza is
reviewing the Company’s economic offer to acquire a 25 year
exploitation concession for the Chañares Herrados block, located in
the Cuyo Basin, Province of Mendoza.
Crown Point (50% WI), together with partner
Petrolera Aconcagua Energía ("Aconcagua") (50% WI) (collectively,
the "Joint Venture"), had previously registered to participate in
an auction process arranged and conducted by the Province of
Mendoza to bid for a 25 year exploitation license covering the 40.6
square kilometer Chañares Herrados concession, located
approximately 50 kilometers south of Mendoza City in the Cuyo
basin.
The Joint Venture offer was opened on December
23rd and is now being reviewed by the Province. The bid includes a
cash payment of US$8.3 million (US$4.15 million net to Crown
Point), a 13% royalty on oil production and a 10 year, US$85.7
million work program which includes well work overs, infrastructure
optimization and a multi- well drilling program. No competing bid
was accepted by the Province.
Based on information published by the Secretaría
de Energía, in November 2020 the Chañares Herrados concession
produced an average of approximately 130 m3 per day (820 barrels
per day) of low to medium gravity crude oil. The concession is
covered by 3D seismic, is easily accessible, and is close to
pipeline infrastructure which delivers oil to the YPF refinery
located on the southern outskirts of Mendoza City.
The Province's review process is expected to
take several weeks before the auction result is confirmed. If the
Joint Venture is awarded the concession it will be operated by
Aconcagua, a private Argentine oil and gas company with an
extensive and successful record in mature oil field operations.
Crown Point will provide geological and geophysical support to the
work program implementation.
About Crown
Point
Crown Point Energy Inc. is an international oil
and gas exploration and development company headquartered in
Calgary, Canada, incorporated in Canada, trading on the TSX Venture
Exchange and with operations in Argentina. Crown Point has a
strategy that focuses on establishing a portfolio of producing
properties, plus production enhancement and exploration
opportunities to provide a basis for future growth.
Abbreviations: "WI" means
working interest; "m3" means cubic meters; "3D" means three
dimensional; "YPF" means YPF S.A.; "US$" means United States
dollars.
Production Rates: Any
references herein to production rates are useful in confirming the
presence of hydrocarbons, however, such rates are not determinative
of the rates at which such wells will continue production and
decline thereafter. While encouraging, readers are cautioned not to
place reliance on such rates in calculating the aggregate
production for the Company. Production rates may be estimated based
on third party estimates or limited data available at this time. In
all cases herein, production rates are not necessarily indicative
of long-term performance of the relevant well or fields or of
ultimate recovery of hydrocarbons.
Forward-looking
Information: This document contains
forward-looking information. This information relates to future
events and the Company’s future performance. All information and
statements contained herein that are not clearly historical in
nature may constitute forward-looking information. Such
information represents the Company’s internal projections,
estimates, expectations, beliefs, plans, objectives, assumptions,
intentions or statements about future events or performance. This
information involves known or unknown risks, uncertainties and
other factors that may cause actual results or events to differ
materially from those anticipated in such forward-looking
information. Crown Point believes that the expectations reflected
in this forward-looking information are reasonable; however, undue
reliance should not be placed on this forward-looking information,
as there can be no assurance that the plans, intentions or
expectations upon which they are based will occur. This press
release contains forward-looking information concerning, among
other things, the following: that the Province's review process is
expected to take several weeks before the auction result is
confirmed; and the Company's business strategies. The reader is
cautioned that such information, although considered reasonable by
the Company, may prove to be incorrect. Actual results achieved
during the forecast period will vary from the information provided
in this document as a result of numerous known and unknown risks
and uncertainties and other factors. A number of risks and other
factors could cause actual results to differ materially from those
expressed in the forward-looking information contained in this
document including, but not limited to, the following: the risk
that Crown Point does not ultimately acquire its 50% working
interest in the concession or that such acquisition is delayed,
whether because the Province does not confirm the award of the
concession to the Joint Venture or for other reasons that the
Company cannot predict; the risk that the terms of the Joint
Venture's offer described herein are amended in a manner that are
less favorable to the Company; the risk that the Company changes
its business strategies; and the risks and other factors described
under “Risk Factors” in the Company’s most recently filed Annual
Information Form, which is available for viewing on SEDAR at
www.sedar.com. With respect to forward-looking information
contained in this document, the Company has made assumptions
regarding, among other things: that the Province will ultimately
confirm the award of the concession to the Joint Venture on the
terms described herein and the timing thereof; and the ability of
the Company to obtain the financing required on acceptable terms to
pay its share of the initial cash payment noted herein and to fund
its share of future work commitments on the concession. Management
of Crown Point has included the above summary of assumptions and
risks related to forward-looking information in order to provide
investors with a more complete perspective on the Company’s future
operations. Readers are cautioned that this information may not be
appropriate for other purposes. Readers are cautioned that the
foregoing lists of factors are not exhaustive. The forward-looking
information contained in this document are expressly qualified by
this cautionary statement. The forward-looking information
contained herein is made as of the date of this document and the
Company disclaims any intent or obligation to update publicly any
such forward-looking information, whether as a result of new
information, future events or results or otherwise, other than as
required by applicable Canadian securities laws.
Neither 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 news
release.
For inquiries please contact:
Brian Moss
President & CEO
Ph: (403) 232-1150
Crown Point Energy Inc.
bmoss@crownpointenergy.com
Marisa Tormakh
Vice-President, Finance & CFO
Ph: (403) 232-1150
Crown Point Energy Inc.
mtormakh@crownpointenergy.com
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