CALGARY, Nov. 12, 2013 /CNW/ - US Oil Sands Inc. ("US Oil Sands" or the "Company") (TSXV: USO), a company focused on oil sands exploration and production in Utah, today announced that it has filed its unaudited interim financial statements ("Interim Report") for the three and nine month period ended September 30, 2013 along with the management's discussion and analysis ("MD&A") of the financial results of US Oil Sands for such period.
A copy of the aforementioned documents may be found for viewing on the System for Electronic Document Analysis and Retrieval website at www.sedar.com as well as US Oil Sands' website at www.usoilsandsinc.com.
SELECTED OPERATIONAL & FINANCIAL HIGHLIGHTS
- Closing of $81 million private placement financing (the "Financing") subsequent to the end of the quarter that fully funds Phase 1 of the PR Spring Project and enables the Company to pursue corporate development activities in other oil sands regions;
- Financing related activities including marketing, negotiation, field reviews and due diligence;
- Initiated opening of the PR Spring Project site through supply of road-building materials for the state-funded road building project;
- Extended duration pump test of the deep aquifer confirming the supply of project water for future expansion; and
- Immediate ramp-up of all professional and supplier activities for the 5,930 acre PR Spring Project.
"The past several months were highlighted by the closing of our $81 million financing that not only funds the initial commercial phase of our PR Spring Project, but also enables us to explore future partnerships and global growth opportunities for our best-in-class environmental approach to oil sands development," said Cameron Todd, CEO of US Oil Sands. "In the near-term we will continue to focus on project management of the PR Spring Project and finalize its scheduling and capital budgeting. The financing was the last major hurdle to overcome and we are now able to proceed on a fully funded basis."
During the third quarter ("Q3 2013") the Company continued to work with its engineering consultants and equipment suppliers to enable initiation of project work on Phase 1 of the PR Spring Project. Project consulting contracts have been awarded to FLSmidth and Norwest Corporation. The Company's detailed mine planning facilitated the identification and planning of future expansion areas within the PR Spring leased acreage area.
Work on the PR Spring Project site was initiated through an agreement to supply water and raw road-building materials in for a state-funded road building project. US Oil Sands permitted and mobilized a man-camp to support field operations. The provision of road building materials enabled the Company to conduct initial mine opening activities during the quarter and at minimal cost to the Company. Crushed aggregate to supply the road was obtained from areas within the Company's planned mine pit. This allowed the Company to initiate mine opening earlier and reduce future mining costs while eliminating surface disturbance from a separate gravel supply pit. Pumping equipment was installed to bring the production water well to operational status. In supplying water for the road project, US Oil Sands was also able to concurrently execute an extended duration pump test of the deep aquifer. This three month test exceeded previous ground water model predictions and confirmed the supply capability of project water supply for future expansion. This water installation will now be used as a key part of the Phase 1 mining and extraction project.
Subsequent to the end of Q3 2013, the Company closed its previously announced $81 million private equity financing, issuing 540,036,331 Common Shares at a price of $0.15 per Common Share. All Common Shares issued pursuant to the Financing are subject to a statutory hold period of four months from the date of closing. Following completion of the Financing, the Company has a total of 852,892,395 Common Shares outstanding on a non-diluted basis. The Company intends to use proceeds from the Financing to complete the first phase of the commercial development of the PR Spring Project and to accelerate future production phases. Proceeds raised in excess of those required to fund the PR Spring Project will allow the Company to initiate corporate development activities that may include the acquisition of or participation in other oil sands assets.
In connection with the Financing, Serafino Iacono, Ronald Pantin, Stephen Lehner, and Alfred Holcomb were appointed to the Company's Board of Directors.
The Company also announced that pursuant to the Company's stock option plan, a total of 29,900,000 stock options were granted to Directors, Officers, Employees and Consultants of the Company at an exercise price of $0.19 per share expiring November 12, 2018, subject to regulatory approval.
With financing complete, the Company is now able to dedicate its efforts to bringing Phase 1 of the PR Spring Project to commercial status. For the remainder of 2013, the Company will continue to focus on the engineering and mine design, procurement of long-lead items, and general site preparation and construction related to Phase 1 of the PR Spring Project. Management anticipates that the off-site fabrication of the process extraction plant will be substantially complete in 2014, with field assembly to occur in 2015 followed by commercial start-up and bitumen production.
Management intends to continue its pursuit of opportunities to add additional resource lands by assessing growth opportunities and furthering regulatory application efforts that ensure a ready inventory of future mineable assets for the Company.
ABOUT US OIL SANDS LTD.
US Oil Sands is engaged in the exploration and development of oil sands properties and, through its wholly owned United States subsidiary US Oil Sands (Utah) Inc., has a 100% interest in bitumen leases covering 32,005 acres of land in Utah's Uinta basin. The Company plans to develop its oil sands properties using its proprietary extraction process which uses a bio-solvent to extract bitumen from oil sands without the need for tailings ponds. The Company is in the pre-production stage, anticipating the commencement of bitumen production and sales in 2015.
The foregoing information contains forward-looking information relating to the future performance of the Company including information relating to the use of proceeds of the Financing, the development and construction of the PR Spring Project, commencement of commercial production and corporate development activities. Forward looking information is subject to a number of known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those anticipated in our forward looking statements. Such risks and other factors include, among others, the actual results of exploration activities, changes in world commodity markets or equity markets, the risks of the petroleum industry including, without limitation, those associated with the environment, delays in obtaining governmental approvals, permits or financing or in the completion of development or construction activities, title disputes, change in government and changes to regulations affecting the oil and gas industry, and other risks and uncertainties detailed from time to time in the Company's filings with the Canadian securities administrators (available at www.SEDAR.com). Forward-looking statements are made based on various assumptions and on management's beliefs, estimates and opinions on the date the statements are made. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in the forward-looking information contained herein. The Company undertakes no obligation to update forward-looking statements if these assumptions, beliefs, estimates and opinions or other circumstances should change, except as required by applicable law.
Discovered bitumen resources or discovered bitumen initially-in-place is that quantity of bitumen that is estimated, as of a given date, to be contained in known accumulations on Company lands prior to production. There is no certainty that it will be commercially viable to produce any portion of the resources. Additional information relating to resource estimates is contained in the Company's Statement of Resources Data and Other Oil and Gas Information for the year ended December 31, 2012 dated April 29, 2013 and available on SEDAR at www.sedar.com.
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.
SOURCE: US Oil Sands Inc.
For further information:
US Oil Sands Inc.
Cameron Todd, CEO or Glen Snarr, President and CFO
Suite 1600, 521 - 3rd Avenue SW
Calgary, Alberta T2P 3T3
Tel: +1 403 233 9366
Email: [email protected]
300 - 5th Avenue SW, 10th Floor
Calgary, Alberta T2P 3C4
Tel: +1 403 218 2833
Email: [email protected]