PanTerra To Sell Stake In Cardium Assets

Transaction Type
Sellers
Announce Date
Post Date
Estimated Price
3MM
Description

Agreed to sale 60% working interest in its Carrot Creek assets.

PanTerra Resource Corp. (TXSV: PRC) has agreed to the sale of a 60% working interest in its Carrot Creek Cardium assets of Central Alberta.

The total purchase price is some C $3.4 million. A letter of intent has been signed and a definitive purchase and sale agreement is being prepared for execution. The disposition will occur in two separate tranches, the details of which follow:

(1) The sale of 60% of the proven producing reserve asset for a price of some C $1.1 million which will take place on or before June 10 .

(2) The sale of 60% of the probable reserve asset and tangible surface equipment for some C $2.3 million, which will take place on or before July 22 .

Transaction metrics of the proven producing portion of the sale is C $45,700 per flowing barrel. This is based on 60% of the current proven producing rate of 40 barrel per day (net 24 barrel per day).

The proceeds of the disposition will be applied to reduce indebtedness under PanTerra's current credit facilities and also to provide additional funds for PanTerra's direct participation in the Tomahawk gas gathering system and the Carrot Creek Phase II Water-flood project. PanTerra will retain a 40% working interest in the Carrot Creek Project.

The Transaction involves a non-arm's length party as Geoffrey Baker is a director of both the vendor and the purchaser. Completion of the sale is subject to the approval of the Toronto Venture Exchange.

PanTerra Resource Corp. is a independent energy company engaged in the acquisition, exploration, and development of conventional and unconventional oil and gas properties in western Canada. The company is based in Calgary.