CALGARY, Dec. 3, 2013 /CNW/ - Fulucai Productions Ltd. (OTCQB:FCPS)
("Fulucai" or the "Company") is pleased to announce that it has entered
into a Memorandum of Understanding (the "MOU") with Blue Sky Langsa
Ltd. ("BSL") whereby the Company has the right to acquire certain oil
and gas interests in North Sumatra, Indonesia, including offshore
leases and equipment (the "Properties"). The asset is known as Langsa
TAC and is a 77 square kilometer offshore concession in 325 feet of
water depth, 55 kilometers from the North Sumatra shoreline. The block
has 2 discovered fields, known as the L and H fields, and 7 wells.
Historic sunk costs for the Langsa TAC are approximately $59.5
Million. Mobil Oil initially made the discovery in 1980.
The Company and BSL intend to enter into a formal Securities Purchase
Agreement for the acquisition following accordance with normal industry
standards, requisite regulatory requirements and approvals in the U.S.,
Canada and Indonesia. Under the terms of the agreement, the Company
will acquire 100% of the shares of BSL from the BSL shareholders for
$7.5 Million consisting of $1.0 million cash at closing and $6.5
Million to be paid from 15% of cash flow (net to BSL's interest)
generated by Langsa TAC. At closing, BSL will hold a total of 65%
interest in Langsa TAC.
Following execution of the MOU, the Company will proceed to conduct due
diligence on BSL, including evaluation and field inspection of the
Properties, prior to the execution of the SPA. The Company hopes to
finalize the Share Purchase Agreement by December 31, 2013 and close
the acquisition by January 15, 2014, with an effective date of January
1, 2014. As this is a related party transaction, Fulucai will engage a
third party to provide a fairness opinion on BSL. At closing, the
current non-independent directors and officers of BSL will resign in
favor of Fulucai appointees.
ON BEHALF OF THE BOARD
Chief Executive Officer
Except for statements of historical fact, this news release contains
certain "forward-looking information" within the meaning of applicable
securities laws. Forward-looking information is frequently
characterized by words such as "plan", "expect", "project", "intend",
"believe", "anticipate", "estimate" and other similar words, or
statements that certain events or conditions "may" occur.
Forward-looking information in this news release includes, but is not
limited to, statements regarding expectations of management regarding
the expiry of hold periods attached to the securities issued in
settlement of debts as described in this news release. Although the
Company believes that the expectations reflected in the forward-looking
information are reasonable, there can be no assurance that such
expectations will prove to be correct. Such forward-looking statements
are subject to risks and uncertainties that may cause actual results,
performance or developments to differ materially from those contained
in the statements including, without limitation, the risk that the hold
period on the shares may not expire as expected. Other than as required
by law, the Company does not intend to update the forward-looking
information contained in this news release.
SOURCE: FuLuCai Productions Ltd.
For further information:
Mr. Mo Fazil