PMI Resources Ltd. and Pentanova Energy Corp. close C$45,000,000 private placement

VANCOUVER, Feb. 10, 2017 /CNW/ - PMI Resources Ltd. ("PMI" or the "Company") (TSXV: PMI), is pleased to advise that the Company and PentaNova Energy Corp. ("PentaNova") have closed a private placement financing in the aggregate amount of C$45,000,000. The Company is also pleased to provide an update on its proposed acquisition (the "Acquisition") of PentaNova Energy Corp. ("PentaNova"), as announced on January 25, 2017.  

The brokered private placement conducted through GMP Securities L.P. and Eventus Capital Corp. for gross proceeds of C$16,400,000 to PentaNova closed on January 31, 2017.  PentaNova also completed a non-brokered private placement for gross proceeds of C$23,820,780.  In addition, PMI closed the non-brokered financing through the issuance of 9,561,000 subscription receipts of PMI for gross proceeds of C$4,780,500 (the "PMI Proceeds").  The PMI Proceeds are being held in escrow pending closing of the Acquisition. The common shares in the capital of PMI issuable on conversion of the subscription receipts will be subject to a four month hold period expiring June 9, 2017.

PentaNova has entered into definitive agreements to acquire an 80% interest in the Maria Conchita Block, an 80% interest in the SN- 9 Block and a 60% interest in the Tiburon Block, all onshore in northern Colombia (collectively, the "Block Acquisitions").    

"We are extremely pleased with the success of the private placement financings and with our ability to secure such high quality assets.  We look forward to closing of the Acquisition and our next steps in the development of these assets," commented Luciano Biondi, Chief Executive Officer of PentaNova.

About PentaNova

PentaNova, a private corporation incorporated under the laws of the British Virgin Islands, is an exploration and development company focused on oil and gas plays in South America. PentaNova has acquired an 80% beneficial working interest in the Maria Conchita Block, onshore Colombia; (ii) an 80% beneficial working interest in the SN-9 Block, onshore Colombia; and (iii) a 60% beneficial working interest in the Tiburon Block, onshore Colombia. Registration of transfer of such beneficial interests are subject to approval by the Agencia Nacional de Hydrocarburos (the "ANH"):

Maria Conchita Block

The Maria Conchita Block is located in the Guajira Basin in Colombia's Caribbean coast and has two gas wells that have been tested at commercial rates. 3-D seismic surveys have been done over areas covering both wells and the requisite environmental permit has been granted. The Maria Conchita Block neighbours the Chuchupa block to its north, one of Colombia's largest fields, which accounts for 40% of Colombia's daily natural gas output and has been in production for 35 years.

SN-9 Block

The SN-9 Block is located in the Lower Magdalena Valley 75 km from Colombia's Caribbean coast and holds "in-situ" gas accumulations and an upside of additional oil structures. The SN-9 Block has 2-D seismic and well data.

Tiburon Block

The Tiburon Block is located in the Upper Guajira on Colombia's Caribbean coast and holds source rock with kerogens Type III, gas prone for Tertiary sequence and Type II, and oil prone for Cretaceous sequence. The Tiburon Block belongs to the same basin as the Chuchupa Block to its south.

Forward-Looking Information

Except for the statements of historical fact, this news release contains "forward-looking information" within the meaning of the applicable Canadian securities legislation that is based on expectations, estimates and projections as at the date of this news release.  The information in this news release about the completion of the Transaction described herein, and other forward-looking information includes but is not limited to information concerning the intentions, plans and future actions of the parties to the transactions described herein and the terms of the Transaction.

Factors that could cause actual results to differ materially from those described in such forward-looking information include, but are not limited to, risks related to the Company's or PentaNova's inability to satisfy a condition precedent to the completion of the Transaction (including obtaining necessary regulatory approvals), other risks related to completion of the Transaction and risks related to the inability of either of the Company or PentaNova to perform its respective obligations under the Transaction.

The forward-looking information in this news release reflects the current expectations, assumptions and/or beliefs of the Company based on information currently available to the Company. In connection with the forward-looking information contained in this news release, the Company has made assumptions about the Company's ability to complete the Acquisition and PentaNova's ability to complete the Block Acquisitions and to perform its obligations thereunder. The Company has also assumed that no significant events occur outside of the Company's normal course of business. Although the Company believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and accordingly undue reliance should not be put on such information due to the inherent uncertainty therein.

Any forward-looking information speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise.

SOURCE PMI Resources Ltd.

For further information: PMI Resources Ltd., David Farrell, President & CEO, Tel: (604) 609-6110, E-mail: gkeep@fiorecorporation.com; PentaNova Energy Corp., Gregg Vernon, President, Tel: (57) 321- 297-3569, E-mail: gvernon@pentanovaenergy.com

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PMI Resources Ltd.

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