VANCOUVER, Aug. 16, 2018 /CNW/ - PentaNova Energy Corp.
(the "Company" or "PentaNova") (TSXV: PNO), announces
the SINU-9 ("SN-9") Farm Out Agreement (the
"Agreement") with Panacol Oil & Gas ("Panacol"),
a wholly owned subsidiary of LATAM Oil & Gas failed to close by
the agreed closing date. Extensions to the closing dates were
given, but Panacol was unable to complete the financing commitments
required as closing conditions of the Agreement and, as a
consequence, the Agreement has been terminated.
Under the terms of the Agreement the US$2.4 million security placed by Panacol as
guarantee in front of the ANH for the SN-9 license commitments will
remain in place until the commitments are deemed complete by the
ANH. These commitments of a minimum of 127.75 km2
of 3D seismic and one exploration well with a minimum spend of
US$22.4 million have to be completed
by December 22, 2020.
The Company has offered to continue discussions with Panacol to
negotiate an alternative agreement and also intends to initiate
discussions with a number of other interested parties.
Additionally, the Company received a letter from Clean Energy
Resources S.A.S ("Clean") as party to the SN-9 Purchase and
Sale Agreement ("SN-9 PSA") by which the Company
received its 80% economic beneficial interest in January 2017, alleging that the Company was in
breach of certain obligations under the SN-9 PSA and that as a
consequence the SN-9 PSA was immediately terminated. The Company
also received an identical letter from ColPan Oil & Gas Limited
("ColPan"), as counterparty to the Tiburon Purchase and Sale
Agreement ("Tiburon PSA") by which the Company
received its 60% economic beneficial interest in February 2017 alleging that the Company was in
breach of certain obligations under the Tiburon PSA and that as a
consequence the Tiburon PSA was immediately terminated.
The Company, in consultation with legal counsel, considers that
the alleged breaches are without merit and that the unilateral
termination by Clean and/or ColPan is not legally valid or
enforceable. The company has requested that Clean and ColPan
retract these letters and have advised of the consequences of
failure to do so, but without success. The Company will take all
legal measures to make Clean and ColPan fully aware of their
inability to terminate the PSAs, that the alleged breaches are
without merit, and that Clean and ColPan will be held fully
responsible for any and all damages arising from their actions. The
Company intends to vigorously defend itself and will pursue all
means available to protect its interests in the SN-9 and Tiburon
Blocks.
SN-9 Block
The 313,638 acre SN-9 block is located in the northern province
of Cordoba, in the Lower Magdalena Basin of Colombia.
The Company has completed the prior consultation process
required to acquire seismic in the block and is currently receiving
bids for the acquisition of 140km2 of 3D seismic and
related services. The Company expects to delay the acquisition of
the 3D seismic to the dry period starting in January 2019, which although being later than
initially planned, should result in reduced acquisition costs.
The prior consultation and permitting process required for
drilling on the block has started with bidding for the required
services. On completion of this process, anticipated for the third
quarter of 2019, civil works will commence with a view to spudding
the first exploration well before the 2019 year end.
Tiburon Block
The Tiburon Block currently covers an area of approximately
245,850 acres in the northern most area in the department of La
Guajira, Colombia.
The Tiburon E&P Contract is currently in Phase 3 of the
exploration period with an existing minimum work obligation to
acquire 200 km of 2D seismic, which can be replaced with an
equivalent minimum commitment to acquire 69.75 km2 of 3D
seismic. The phase commitment is currently suspended due to "Force
Majeure and Third-Party Acts".
About PentaNova
PentaNova is investing in proven leadership and technology to
develop oil and natural gas fields it has acquired in areas
surrounding some of the key energy producing areas in Colombia and Argentina. With decades of proven experience
in Latin America and global energy
development, PentaNova's leadership is working with local partners
and service providers, including YPF, Argentina's respected energy producer, to
deliver the energy for Latin
America's future.
Forward-Looking Information
This news release contains "forward-looking statements" and
"forward-looking information" (collectively referred to herein as
"forward-looking statements") within the meaning of applicable
securities legislation. Such forward-looking statements include,
without limitation, forecasts, estimates, expectations and
objectives for future operations that are subject to a number of
material factors, assumptions, risks and uncertainties, many of
which are beyond the control of the Company.
Forward-looking statements are statements that are not
historical facts and are generally, but not always, identified by
the words "expects", "plans", "anticipates", "believes", "intends",
"estimates", "continues", "projects", "forecasts", "potential",
"budget" and similar expressions, or are events or conditions that
"will", "would", "may", "could" or "should" occur or be achieved.
This news release contains forward-looking statements, pertaining
to, among other things, the following: The quality of the SN-9
block as an exceptional core asset for the Company, the Company's
ability to execute the exploration program required to confirm the
gas potential of the SN-9 block, the Company's timeline to for its
operational activities, the extension of the gas play from
Canacol's gas producing area adjacent to the SN-9 block into the
SN-9 block, the Company's intention to focus on the south eastern
structures of the SN-9 block in the immediate term, the Company's
expectations regarding the timing of receipt of such 3D seismic
data, the Company's timing for the prior consultation and
permitting process required for drilling on the SN-9 block in, the
Company's plans regarding the initiation of civil works and the
timing thereof, and the Company's plans regarding the timing for
the spudding of the first exploration well on the SN-9
block.
Although the Company believes that the material factors,
expectations and assumptions expressed in such forward-looking
statements are reasonable based on information available to it on
the date such statements are made, undue reliance should not be
placed on the forward-looking statements because the Company can
give no assurances that such statements and information will prove
to be correct and such statements are not guarantees of future
performance. Since forward-looking statements address future events
and conditions, by their very nature they involve inherent risks
and uncertainties.
Actual performance and results could differ materially from
those currently anticipated due to a number of factors and risks.
These include, but are not limited to: known and unknown risks,
including those set forth in the Company's Management's Discussion
and Analysis for the year ended December 31,
2017 (a copy of which can be found under PentaNova's profile
on SEDAR at www.sedar.com); the risks associated with the oil and
gas sector, including current and expected oil and natural gas
prices; exploration and development costs and delays; reserves
discovery and decline rates; pipeline and transportation capacity;
weather, health, safety and environmental risks; integration of
acquisitions, competition, and uncertainties resulting from
potential delays or changes in plans with respect to acquisitions,
development projects or capital expenditures and changes in
legislation including, but not limited to, tax laws, royalties,
incentive programs and environmental regulations; stock market
volatility and the inability to access sufficient capital from
external and internal sources; operations in foreign jurisdictions;
general economic, market or business conditions; global economic
events; changes to PentaNova's financial position and cash flow;
the availability of qualified personnel, management or other key
inputs; currency exchange fluctuations; changes in political and
security stability; risks and uncertainty related to distribution
and pipeline constraints; and other unforeseen conditions which
could impact the Company. Accordingly, readers should not place
undue importance or reliance on the forward-looking statements.
Readers are cautioned that the foregoing list of factors is not
exhaustive.
Statements, including forward-looking statements, contained
in this news release are made as of the date they are given and the
Company disclaims any intention or obligation to publicly update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, unless so required by
applicable securities laws. The forward-looking statements
contained in this news release are expressly qualified by this
cautionary statement.
Additional information on these and other factors that could
affect the Company's operations and financial results are included
in reports on file with applicable securities regulatory
authorities and may be accessed under PentaNova's profile on SEDAR
at www.sedar.com.
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.
SOURCE PentaNova Energy Corp.