CALGARY, May 30, 2011 /CNW/ - (TSXV: BRX) Brixton Energy Corp.
("Brixton") announces it is currently negotiating the potential
purchase of two oil and gas producing properties, with combined 2010
revenue of $5.1 million and significant proven and proven plus probable
reserves with upside potential from a private energy fund. The first
operated property spans over 5 townships in central Alberta with
extensive 3D seismic and interpretation completed. The second property
in northern Alberta, a large portion of which is joint ventured with a
major also has high quality 3D seismic interpreted. Both properties
have an inventory of additional drilling locations with extensive
professional work already completed on these drill-ready targets.
Brixton expects to fund these transactions through the previously
announced credit facility of up to $50 million, which will be
collateralized by the value of these reserves and where repayment of
the debt will come from the revenue derived from the production of
theses properties and or potential equity financings. Current revenue
from these properties will also allow the Company to develop additional
targets to establish additional reserves and production, thereby
potentially increasing the cash flow to service and pay down its credit
facility. The Company is currently in the process of finalizing the
business plan proposal to its lender. Part of the proposal will also
include streamlining operations to reduce overhead per barrel to
provide additional funds for working capital.
Brixton's wholly owned subsidiary will hold and operate these assets.
Management feels that acquiring these low risk producing properties will
deliver significant upside to our shareholders. The Company expects to
retain the existing infrastructure and field operations and is
currently evaluating the necessary internal staff requirements needed
to assist Brixton in maintaining operations and conducting future
development of these properties.
The Company expects to finalize the negotiations in the coming weeks and
will issue an update as progress is made toward transaction completion.
This is an arms length transaction and finders fees may be payable in
accordance with the TSX Venture rules and regulations.
We seek safe harbour.
On Behalf of Brixton Energy Corp.
Richard Saxon, President
We seek Safe Harbor
NEITHER 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 Brixton Energy Corp.
For further information:
Brixton Energy Corporation
#328, 1500 14th Street SW Calgary, AB T3C 1C9
PHONE: 403-269-8424 FAX: 403-269-8477