Transeuro Energy Corp.: Acquisition of Beaver River Signed
VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 04/27/11 -- Transeuro Energy Corp. (TSX VENTURE: TSU)(OSLO: TSU) ('Transeuro' or the 'Company') is pleased to announce the Company has executed a Share Purchase Agreement (SPA) with Questerre Energy Corporation ('Questerre') pursuant to the Letter of Intent as previously announced on Sept 9th 2010 as follows:
1. Transeuro will acquire the remaining 50% interest in the Beaver River
field in British Columbia through the acquisition of all the outstanding
shares of Questerre Beaver River Inc, a wholly owned subsidiary of
Questerre. At closing Transeuro will own 100% of the Beaver River field
including the 2 producing wells, the production equipment, gathering
system and all associated infrastructure.
2. Pursuant to the acquisition, the $5.15 million debt payable by Transeuro
to Questerre Beaver River Inc. will be eliminated on consolidation. Upon
closing, there will be no amounts due to Questerre by Transeuro.
3. Transeuro will issue to Questerre forty (40) million shares (8.7%) in
Transeuro.
Closing is subject to receipt of all requisite approvals and conditions precedent.
The Chairman, Aage Thoen commented;
'The acquisition furthers our strategy to pursue large assets and has the potential to add short term production from the existing wells and infrastructure in place. Canada represents a secure, low risk venture for Transeuro in a proven hydrocarbon basin. With the large discount between gas and oil pricing we believe gas assets are currently undervalued and that North American gas prices and asset valuations will recover over the next one to two years.'
'Further through this transaction, the removal of the operating debts of CDN$5.15 million eliminates 75% of the Companies current liabilities as of December 31st 2010 and creates a strong, stable balance sheet to support future activities and expansion.'
The Beaver River field:
-- consists of 35 sections in the Liard Basin in North East British
Columbia, adjacent to the Horn River Basin that has attracted
considerably interest from major oil companies for the discovered shale
gas assets. Interest in the Liard Basin has increased with recent land
sales close to the Beaver River by some of the companies active in the
Horn River area.
-- has ongoing production of around 700 thousand cubic feet per day (mcf/d)
from 2 shallow wells, flowing into the Spectra Energy's pipeline that
transits through the field.
-- The field was discovered in 1961 by Amoco who targeted the deeper
conventional carbonate reservoir, the 'Nahanni', from 3500 metres, where
a 700 metre gas column was discovered. Amoco estimated recoverable
reserves in the Nahanni of 1.47 trillion cubic feet (Tcf), but abandoned
the Nahanni in the 1970's after only producing 179 billion cubic feet
(Bcf), 11% of expected production.
-- Amoco also produced 6.6 Bcf from within the overlying 2500 metres of
gross shale intervals using conventional operating methods from the
vertical wells.
-- has a number of old production wells drilled into the Nahanni that
present opportunities to increase production and to appraise the shale
potential in a cost effective manner and without the need to drill new
wells from surface.
-- Despite the current production the field has no reserves assigned at
this time as at current gas prices, operating costs exceed revenues.
However in 2007 Netherland Sewell Associates (NSA,
http://www.netherlandsewell.com) conducted a preliminary review of the
field data to assess the shale gas and conventional gas potential of the
upper intervals. The report indicated potential for Original Gas In
Place (OGIP) figures of 425-750 Bcf per section for 1000 metre
thickness. It is this potential across the 35 license sections that will
be investigated with additional operations and production.
The President & CEO, David Worrall commented; 'The historical production at Beaver River demonstrates commercial production can be achieved at various depths from 1000 to 4000 metres and the NSA analysis indicates the potential for very significant gas in place. While we have some production and data, more appraisal work is required to unlock this potential and to turn the indicative numbers into resources and then to reserves. With the pipeline on the lease we aim to achieve commercial production as we work through the appraisal programme. The British Columbia Oil and Gas Commission has recently issued strong statements supporting the gas industry in British Columbia, in particular for shale gas and the operating technique of large hydraulic fracs, so we do not expect the same environmental hurdles that exist in other areas of North America.'
Transeuro is involved in the acquisition of petroleum and natural gas rights, the exploration for, and development and production of crude oil, condensate and natural gas. The Company's properties are located in Canada, Armenia, and Ukraine. In addition, the Company holds a back-in option to Eaglewood Energy Inc.'s exploration licenses in Papua New Guinea.
On behalf of the Board of Directors
Aage Thoen, Chairman
When used herein, the term 'boe' means barrels of oil equivalent on the basis of one boe being equal to one barrel of oil or NGLs or 6,000 cubic feet of natural gas (6 mcf: 1 bbl). Barrels of oil equivalent may be misleading, particularly if used in isolation. A conversion ratio of six mcf of natural gas to one boe is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. The statements contained in this release that are not historical facts are forward-looking statements, which involve risks and uncertainties that could cause actual results to differ materially from the targeted results. The Company relies upon litigation protection for forward looking statements.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) nor the Oslo Bors accepts responsibility for the adequacy or accuracy of this release.
Contacts:
Transeuro Energy Corp.
Chris McGillivray
IR
+1 604 728 0040
Transeuro Energy Corp.
David Parry
SVP
+1 604 681 3939
Transeuro Energy Corp.
Karen Jenssen
IR
+47 91729787
www.transeuroenergy.com
