CALGARY, May 6 /CNW/ - Result Energy Inc. ("Result"; TSX-V: RTE) is
pleased to announce it has accepted a cash offer from an arm's length, private
oil and gas company to purchase certain of the Company's conventional oil and
gas properties which are located in Alberta and Saskatchewan. The offer is
subject to typical conditions, including satisfactory due diligence, purchaser
financing and board approvals, the negotiation of a definitive purchase and
sale agreement, and required regulatory approvals. The anticipated closing
date is July 1, 2009.
The sale proceeds (approximately $11.8 million, subject to closing
adjustments) will be used to extinguish the Company's bank debt and working
capital deficiency and to provide funds for ongoing operations. This
divestiture is part of Result's plan to increase its focus on the resource
potential of the Horn River Basin shale gas play in northeastern British
Columbia and the Bakken oil play in southeastern Saskatchewan.
Following completion of this asset sale, the Company will hold oil and
gas properties with an estimated value of $17 million, $34 million in tax
pools and $1.5 million in cash with no debt.
Result gained early entry into the Horn River Basin during 2007 and 2008,
and has since amassed interest in 83 gross (44 net) sections. Result is
partnered with a large energy trust in 43 gross (26 net) sections at Gunnell
Creek, and with a private company in 25 gross (2.5 net) sections at Dilly
Creek. The Company has a 100% working interest in an additional 10 sections at
West Gunnell Creek and 5 sections at Moss Creek. Result's Horn River project
areas are situated in close proximity to lands held by various major industry
players. In conjunction with its energy trust partner, Result has recently
joined the Horn River Producers Group, an industry cooperative involving the
major operators in the Horn River play.
The Horn River is widely regarded as analogous to the Barnett shale gas
play in Texas. However, the Horn River shales are generally thicker and
exhibit greater gas maturities. Furthermore, the Government of British
Columbia has established an attractive lease tenure system and proposes to
implement a net profits royalty regime to encourage shale gas development.
In southeast Saskatchewan, Result has farmed-in to seven sections
targeting the Bakken light oil play. The Company drilled one horizontal well
(100% WI) in Q1, 2009 and completion operations are scheduled for summer 2009.
Investors are cautioned that this news release contains forward looking
information. Such information is subject to known and unknown risks,
uncertainties and other factors that could influence actual results or events
and cause actual results or events to differ materially from those stated,
anticipated or implied in the forward-looking information. Readers are
cautioned not to place undue reliance on forward-looking information, as no
assurances can be given as to future results, levels of activity or
Result Energy Inc. is a publicly traded Canadian energy company involved
in the exploration and development of oil and gas properties in western
Canada. Result trades on the TSX Venture Exchange under the symbol "RTE".
Neither 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: William Matheson, President & CEO, Result
Energy Inc., (403) 777-0007