/THIS NEWS RELEASE IS NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE
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TSX Venture Exchange
Trading Symbol: PCA
CALGARY, Sept. 26, 2011 /CNW/ - PetroSands Resources (Canada) Inc. ("PetroSands" or the "Company") is pleased to announce management appointments, additions to the
Board of Directors, and is providing an update to its current
Management Appointments and Additions to the Board of Directors
Mr. Dwight Fieseler, Chief Financial Officer. Mr. Fieseler brings over 21 years of
experience in the oil and gas industry. Most recently, he was Vice
President, Finance & Chief Financial Officer at Petro Uno Resources
Ltd., a public oil & gas exploration company. He also held a number of
other senior finance positions with major international and
intermediate E&P companies including Bonus Energy, Defiant Energy,
Centurion Energy, Compton Petroleum, and Wainoco Oil. Mr. Fieseler is a
Certified General Accountant (CGA) and holds a Bachelor of
Administration from the University of Regina.
Mr. Bruce Eckert, Vice President, Operations. Mr. Eckert is a professional engineer with
over 30 years experience in a variety of small, midsize and senior E&P
companies. Most recently, Mr. Eckert spent 14 years with Enerplus
Resources where he managed over 200 field staff throughout their
Western Canadian operations. He holds a Bachelor of Science in
Petroleum Engineering from Montana Tech., and is a member of APEGGA.
Mr. Rick Ippolito, Vice President, Exploration. Mr. Ippolito is a professional geological
engineer with over 35 years of diversified geological and engineering
experience with multinational oil and gas companies. Most recently he
was Exploration Manager at Bronco Energy. Prior thereto, he was the
Exploration Manager at Greyhawke Resources and Quintana Exploration. He
holds a Bachelor of Science in Geological Engineering and is a member
of CSPG, AAPG and APEGGA.
Mr. William Bailey, Vice President, Engineering. Mr. Bailey is a professional reservoir
engineer with over 35 years of industry experience. He has worked with
a number of junior oil and gas companies in addition to major
international E&P organizations including Gulf Canada Resources. He
holds a Bachelor or Science in Mechanical Engineering and is a member
Mr. Kevin D. Murphy, Vice President, Land. Mr. Murphy is a landman with over 21years of
experience. He previously served as Land Manager at Caravan Oil & Gas
Ltd. Prior thereto, he was Vice President, Land at Blackpool
Exploration. Mr. Murphy has also held senior level Contracts and
Negotiation positions with other junior and intermediate E&P companies.
He holds a Bachelor of Commerce in Petroleum Land Management and is a
member of the Canadian Association of Petroleum Landmen (CAPL).
Board of Directors
The Company is pleased to announce the addition of two new board
Ryan Dunfield. Mr. Dunfield is Vice President with the Vancouver B.C. private equity
group, Gibralt Capital Corp. and its affiliate, Second City Capital
Partners. Mr. Dunfield is heavily involved with the acquisition and
divestiture of portfolio companies within the resource sector. Previous
to Gibralt Capital, Mr. Dunfield worked in the debt capital markets
with exposure to corporate banking, leveraged finance and loan
syndications. Most recently, Mr. Dunfield was the Director of Loan
Syndications & Trading with a Canadian financial institution focused on
structuring and distributing first and second lien syndicated bank
loans within the oil & gas sector. Mr. Dunfield received a Bachelor of
Economics and Finance from the University of Calgary.
Dennis Nerland. Mr. Nerland has been a partner of Shea Nerland Calnan LLP since 1990,
practicing primarily in the areas of tax and trust law. Mr. Nerland is
a current and past Director of a number of private and public companies
listed on the TSX Venture Exchange as well as the Toronto Stock
Exchange and is currently a trustee of a number of private investment
trusts. Mr. Nerland holds a Bachelor of Laws from the University of
Calgary, a Master of Arts degree in Economics from Carleton University,
a double honours Bachelor of Science degree in Mathematics and
Economics from the University of Calgary, and is a member of the Law
Society of Alberta.
The board of directors of the Company is now composed of the following
individuals: Greg T. Busby, President & CEO, George Paulus, Mal
Spooner, Ryan Dunfield and Dennis Nerland.
Additionally, the Company has granted options to certain directors and
an officer to acquire an aggregate of 400,000 common shares of the
Company at an exercise price of $0.18 per common share. The options
vest and become exercisable as to one-half on the date of grant and one
half on the first anniversary of the date of grant and will expire on
Sept. 23, 2016. Stock option grants are subject to all regulatory
approvals, including the approval of the TSX Venture Exchange.
The Company's current daily production is approximately 400 boe/d of
which 75% is derived from oil and natural gas liquids with the
remaining 25% from associated solution gas. Essentially all production
comes from the Company's 100% owned and operated core area at Provost
in east-central Alberta.
The Company recently re-completed two (2.0 net) wells at Provost in an
uphole Sparky formation. The program was initiated based on related
type activities carried out by other surrounding industry competitors
in the area. The initial well at 10-21 was successfully fracture
stimulated and is producing approximately 12 boe/d from the Sparky
formation. This well is currently being reviewed to determine if
additional follow-up work will be undertaken as initial production
rates indicated higher rates than what is currently being delivered.
The second location at 13-22 was also recently fracture stimulated
using native Sparky oil to eliminate any potential concern of damaging
the formation. Both wells are being evaluated for commingling with
lower producing zones as deeper formations are perforated and opened,
however, the respective zones are currently mechanically isolated. It
is anticipated that the commingling operations could potentially more
than double current production from both wells and facilities are now
in place to handle any expected increase in fluid production. The
Company's owned central production facility at 4-29-38-3W4 has
sufficient capacity to handle any such increase in oil, water and
solution gas produced in the area.
The Company continues its ongoing efforts to optimize and increase field
efficiencies, monitor operating costs and maintain compliance with all
government authorities in adherence to best oilfield practices.
PetroSands is also currently in discussions with other area producers
to offer custom processing at the Company's owned facility that could
possibly lead to an increase in revenues and decrease in operating
costs on a per boe basis. The Company currently enjoys its relationship
with local landowners and strives to maintain its positive corporate
standing with the surrounding community.
Approximately one half of the Company's production is protected from
fluctuating commodity prices via an executed hedging contract in effect
until December 31, 2012. Production under the Costless Collar is hedged
with a set floor price of $95.00/bbl and ceiling price of $114.50/bbl,
providing the Company with increased revenue stability over the long
term. The Company actively monitors the energy markets and will
continue to make adjustments to its hedging strategy when warranted.
Additionally, the Company has further reduced its utilization of the
revolving credit facility to approximately $2 million from both the
close of the recent financing and continued monthly production
revenues. Funds received from the recent financing will support the
Company's Q4 capital expenditure program consisting of a multi-well
drilling program in conjunction with the shooting of a 3-D seismic
program in the vicinity of Provost. A development drilling location
(0.35 net) on its joint lands with an industry partner at Long Coulee
in southern Alberta is also scheduled prior to year-end.
The Provost drilling program will focus on multi-zone targets ranging
from the Sparky formation down through the GP, Rex, Lloydminster,
Cummings and Dina formations within the Mannville Group. The ERCB has
allowed for commingled production resulting in a much higher chance of
drilling success and thus reducing the risk of a dry hole. Offsetting
initial production rates in the area range from as high as 150 boe/d
for vertical wells and up to 250 boe/d for horizontal wells.
The Company has initiated a 3-D seismic program in the vicinity of the
Provost area. Results are expected to be processed in Q4 and the
Company is confident that this could lead to several new pools that can
be exploited and tied into Company owned infrastructure.
The Company has also identified a development well location at Long
Coulee targeting a previously abandoned pool which management believes
to contain a significant amount of remaining oil that may be recovered
using newer and innovative drilling and completion techniques. Initial
production rates are expected to be in the range of 150 - 250 boe/d
with as many as 4 vertical and/or horizontal wells to delineate the
pool. The Company feels this prospect has the potential of becoming an
additional core area.
Lastly, the Company's Q4 capital expenditure program will qualify as
Canadian Exploration Expense (CEE) and Canadian Development Expenses
(CDE) as required by Revenue Canada and will fulfill the company's
remaining 2011 flow-through obligation.
Management anticipates a successful exit to year-end with encouraging
results from its operational efforts over the past six months. There
are currently 27 multi-zone drill locations identified by the Company
in Provost on existing 3-D seismic. These locations combined with
prospects anticipated from the new seismic data could result in a
substantial drilling inventory for 2012 and beyond.
Looking forward, PetroSands is now a full-cycle exploration and
production company with the technical credibility to capitalize on
internally generated prospects. Management is well positioned to pursue
future growth strategies through the execution of farm-in opportunities
and the increased development and exploration of its core assets. The
Company also continues to evaluate strategic property and corporate
acquisition opportunities that is expected to create additional cash
flow and increase the Company's production and reserves.
About PetroSands Resources (Canada) Inc.
PetroSands Resources (Canada) Inc. is a dynamic publicly traded junior
oil producer targeting oil-based opportunities in Western Canada. The
Company is focused on strategic oil based acquisitions within its core
areas in addition to exploiting and exploring for incremental
production, reserves and increasing cash flow. The Company currently
has approximately 38.2 million common shares outstanding. PetroSands'
shares are listed on the TSX-V under the trading symbol "PCA".
* Boe Presentation: The term BOE may be misleading, particularly if used in isolation. A
BOE (barrel of oil equivalent) conversion of 6 million cubic feet
(Mcf): 1 barrel (bbl) is based on an energy equivalency conversion
method primarily applicable at the burner tip and does not represent a
value equivalency at the wellhead.
Forward-Looking Statements: This news release contains certain forward-looking statements,
including but not limited to, the anticipated timing of the closing of
the Disposition, management's assessment of future plans and
operations, and the related expected success from drilling operations,
expectations regarding future levels of production, revenues and
drilling inventory, capital expenditures and the timing thereof and
expected timing and results from operations, all of which involve
substantial known and unknown risks, uncertainties and assumptions,
certain of which are beyond the Company's control. Such risks,
uncertainties and assumptions include, without limitation, oil and gas
exploration, development, exploitation, production, marketing,
processing and transportation, loss of markets, volatility of commodity
prices, currency fluctuations, imprecision of reserve estimates,
environmental risks, competition from other producers, inability to
retain drilling rigs and other services, delays resulting from or
inability to obtain required regulatory approvals and ability to access
sufficient capital from internal and external sources, the impact of
general economic conditions in Canada, the United States and overseas,
industry conditions, changes in laws and regulations (including the
adoption of new environmental laws and regulations) and changes in how
they are interpreted and enforced, increased competition, the lack of
availability of qualified personnel or management, fluctuations in
foreign exchange or interest rates, stock market volatility and market
valuations of companies with respect to announced transactions and the
final valuations thereof, and obtaining required approvals of
regulatory authorities. The Company's actual results, performance or
achievements could differ materially from those expressed in, or
implied by, these forward-looking statements and, accordingly, no
assurances can be given that any of the events anticipated by the
forward-looking statements will transpire or occur, or if any of them
do so, what benefits that the Company will derive there from. Readers
are cautioned that the foregoing list of factors is not exhaustive.
Additional information on these and other factors that could affect the
Company's operations and financial results are included in reports,
including the Company's annual information form for the financial year
ended December 31, 2009, on file with Canadian securities regulatory
authorities and may be accessed through the SEDAR website
(www.sedar.com). All subsequent forward-looking statements, whether
written or oral, attributable to the Company or persons acting on its
behalf are expressly qualified in their entirety by these cautionary
statements. Furthermore, the forward-looking statements contained in
this news release are made as at the date of this news release and the
Company does not undertake any obligation to update publicly or to
revise any of the included forward-looking statements, whether as a
result of new information, future events or otherwise, except as may be
required by applicable securities laws.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER
(AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE)
ACCEPTS RESPONSIBILTY FOR THE ADEQUACY OR ACCURACY OF THIS NEWS
SOURCE PetroSands Resources (Canada) Inc.
For further information:
Greg T. Busby, President & CEO
PETROSANDS RESOURCES (CANADA) INC.
Telephone: (403) 265-2770
Fax: (403) 265-2775
TSX Venture: PCA