/NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA/
CALGARY, April 6 /CNW/ - Suroco Energy Inc. (TSX Venture Exchange: SRN)
(the "Corporation") is delighted to announce that further to its July 21, 2008
and October 8, 2008 press releases, it has closed an important arm's length
acquisition involving interests in several oil and gas properties located in
Colombia (the "Transaction"), such Transaction is effective as of March 31,
The Transaction involves one oil producing block (Suroriente) and two
exploration blocks (Alea 1848A and Alea 1947C) in the Putumayo Basin and one
exploration block (Arjona), containing the existing Arjona gas discovery, in
the Lower Magdalena Basin. Most importantly, the Transaction significantly
increases the Corporation's working interest in these blocks and its
respective share of oil production in the Suroriente block.
- Increased working interest in the Suroriente block incremental
production contract from 10.29% to 15.83%.
- Increased production attributable to the Corporation's increased
working interest in the Suroriente block from 210 barrels of oil per
day to 323 barrels of oil per day (average for February and March
- Increased working interest in the Arjona operating production at risk
contract from 16.3% to 32.5%, which contains the Arjona gas
- Increased working interest in the Alea 1848A ANH exploration block
from 31.1% to 50%, where exploration seismic is planned for Q2, 2009.
- Increased working interest in the Alea 1947C ANH exploration contract
from 15.9% to 24.5%, where exploration seismic is planned for Q2-Q3,
Please refer to Form 51-101F1 - Statement of Reserves Data and Other Oil
and Gas Information for the Corporation and the Form 51-101F2 - Report on
Reserves Data by Independent Qualified Reserves Evaluator or Auditor prepared
by GLJ Petroleum Consultants for the Corporation's reserves data on its
interests in oil and gas properties in Colombia effective December 31, 2008.
As a result of closing of the Transaction, the Corporation has increased its
working interests in those oil and gas properties in Colombia, as described
under "Highlights" above, and expects its reserves data for such oil and gas
properties in Colombia to increase accordingly. GLJ Petroleum Consultants has
not reviewed those Colombian properties as of the effective date of the
Transaction. The Corporation's December 31, 2008 reserves data is available
for viewing on the SEDAR website at www. sedar.com and the Corporation's
website at www.suroco.com.
The Corporation acquired the interests in the oil and gas properties
referenced above in exchange for 8,700,000 common shares in the capital of the
Corporation at a deemed price of US$1.00 per share and 4,000,000 Contingent
The Contingent Value Rights entitle the vendor, Alentar Holdings Inc.
("Alentar"), to acquire one common share of the Corporation for each
Contingent Value Right deemed exercised. The Contingent Value Rights contain
terms such that 1,000,000 Contingent Value Rights will be deemed exercised
upon the occurrence of a "Declaration of Commerciality" in either the Alea
1848A block or the Alea 1947C block, subject to a maximum of two Declarations
of Commerciality per the Alea 1848A block and two Declarations of
Commerciality per the Alea 1947C block. The Contingent Value Rights expire
within ten (10) years of the date of issuance.
The Corporation is required to appoint one nominee of Alentar, Mr. Juan
Szabó, to the board of directors of the Corporation within 60 days from the
effective date of the Transaction. Please refer to the Corporation's July 21,
2008 press release for greater detail as to the Corporation's participating
interests in the interests acquired pursuant to the Transaction and for a
summary of Mr. Szabó's resume.
Mr. Alastair Hill, the Corporation's President commented:
"This transaction is important to Suroco as it will increase our existing
production by approximately 50%, but most importantly will give us a larger
share in the Suroriente block, which we view as an under-developed producing
block with excellent reserves and production growth potential. Development
drilling in this block is expected to commence in late Q3, 2009, following
interpretation of the 3D seismic program and will be the first development
drilling to take place in the block since 1991 when the last well was drilled.
In addition to this planned activity, exploration seismic is due to commence
in the Alea blocks in Q2, 2009, which may provide us with exploration drilling
opportunities in 2010. Finally, as part of the transaction, we will welcome
Mr. Juan Szabo to the board and look forward to benefiting from his presence,
knowledge and industry contacts that he will bring.
The Corporation is a Calgary-based junior oil and gas company, which
explores for, develops, produces and sells crude oil, natural gas liquids and
natural gas in Colombia and Western Canada. The Corporation's common shares
trade on the TSX Venture Exchange under the symbol SRN.
Forward Looking Statements
Certain information regarding the Corporation contained herein may
constitute forward looking statements within the meaning of applicable
securities laws. Forward looking statements may include estimates, plans,
expectations, opinions, forecasts, projections, guidance or other statements
that are not statements of facts. Although the Corporation believes that the
expectations reflected in such forward looking statements are reasonable, it
can give no assurance that such expectations will be realized. These
statements are subject to certain risks and uncertainties and may be based on
assumptions that could cause actual results to differ materially from those
anticipated or implied in the forward looking statements. The Corporation's
forward looking statements are expressly qualified in their entirety by this
The TSX Venture Exchange has in no way passed on the merits of the
Transaction and has neither approved nor disapproved the contents of the press
release. There can be no assurance that the Transaction will be completed as
proposed or at all. Trading in the securities of the Corporation should be
considered highly speculative.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
For further information:
For further information: Travis Doupe, VP Finance and Chief Financial
Officer of the Corporation, Telephone: (403) 232-6784