(TSX-V | OYL)
TORONTO,, Nov. 3, 2014 /CNW/ - CGX Energy Inc. (TSX-V - OYL) (the "Company") announced today the release of its unaudited consolidated financial results for the quarter ended September 30, 2014, together with its Management Discussion and Analysis. These documents will be posted on the Company's website at www.cgxenergy.com and SEDAR at www.sedar.com.
Third Quarter 2014 Overview and Highlights
- Financial Results - The Company recorded a net loss of $1,213,618 or $0.02 a share for the three month period ended September 30, 2014, compared with a gain of $10,220,761 or $0.13 a share for the same period in 2013.
- Seismic Survey and Strategic Equity Investment – On September 22, 2014, the Company entered into a seismic contract with Prospector PTE. Ltd. ("Prospector") to conduct a 3D seismic survey covering approximately 3,100 km2 on the Company's 100% owned Demerara Block as part of its commitments under the Demerara petroleum agreement. The aggregate cost of this seismic survey will be approximately U.S.$18 million with U.S.$7 million being paid to Prospector by way of issuance of 15,534,310 common shares, U.S.$2.5 million payable 30 days after receipt of invoice to be issued at the beginning of the survey (expected in fiscal 2014) and the remainder of approximately U.S.$8.5 million payable in cash twelve months after the conclusion of the seismic survey (expected in fiscal 2015). After the issuance of common shares, Prospector will own approximately 16.6% of the issued and outstanding common shares in the capital of the Company. As of the date hereof, the Company has issued 9,280,065 common shares under the seismic contract with Prospector.
- Bridge Loan – In October 2014, the Company entered into a bridge loan agreement (the "Bridge Loan") with of Pacific Rubiales Energy Corp. in the aggregate principal amount of C$7.5 million. The Bridge Loan is a non-revolving term facility term in which, the Company may draw all or part of the facility in one or more advances to be made on a date or dates agreed to by the parties hereto. The Bridge Loan accrues interest at an annual rate of 5% per annum and is repayable in full including all accrued interest 12 months from the date of the first advance. As at the date hereof, the Company has not yet drawn any amounts on this Bridge Loan.
- Repsol Dispute – On September 29, 2014, the Arbitral Tribunal of the London Court of International Arbitration granted the Company a procedural order amending its claim against Repsol Exploration, S.A. ("Repsol") to include a claim for amounts owing by Repsol to the Company in the amount of U.S.$889,663 in connection with the drilling of the "Jaguar" exploration well on the Georgetown Block, offshore Guyana (the "New Claim"). The New Claim will be taken up after the January, 2015 hearing during the damages phase of the proceedings, if any.
- Strategic Partners and New Initiatives – The Company continues its initiatives to secure a Joint Venture Partner for its Corentyne Block and is actively pursuing this initiative. In the short term, the Company will likely require additional financing and seek to widen its shareholder base, but still with a view to negotiating farm-out transactions as the primary way to enhance shareholder value.
- Cost Cutting Initiatives – General and administration costs decreased by $70,003 to $357,016 in the three month period ended September 30, 2014 from $427,019 for the same period in 2013. In addition, management and consulting fees decreased by $493,133 to $498,271 during the three month period ended September 30, 2014 compared to $991,404 for the same period in 2013. The Company continues to reduce general and administrative costs leading up to the drilling of the next exploration well at the Corentyne Block.
About CGX Energy
CGX Energy is a Canadian-based oil and gas exploration company focused on the exploration of oil in the Guyana-Suriname Basin.
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
This news release contains forward-looking statements. Forward-looking statements are frequently characterized by words such as "plan", "expect", "project", "intend", "believe", anticipate", "estimate", "may", "will", "would", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur in the future. These forward-looking statements are based on certain key expectations and assumptions made by CGX Energy. CGX Energy believes the expectations and assumptions on which it develops forward-looking statements are reasonable; however, undue reliance should not be placed on forward-looking statements as there can be no assurance they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. In addition, other risks that may affect the forward-looking statements in this news release are outlined further in the Company's Annual Information Form dated March 5, 2014 filed on SEDAR at www.sedar.com.
The forward-looking statements contained in this news release are made as of the date hereof and CGX Energy undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
SOURCE: CGX Energy Inc.
For further information: Michael Galego, General Counsel and Secretary at (416) 843-3858 or [email protected]