Centric Energy Corp. ("Centric Energy" or "the Company") (TSX
VENTURE: CTE) is pleased to announced that it has signed a
Production Sharing Contact (the "PSC") with the Government of the
Republic of Kenya for Block 10BA located in the northern part of
the Rift Valley Province of Kenya, and covering part of the East
African Rift system.
The PSC was officially signed in a ceremony in Nairobi, on
January 27th, 2010, by the Honourable Kiraitu Murungi, Minister for
Energy of the Republic of Kenya, and Alec Robinson, President and
CEO of Centric Energy.
"Block 10BA is a very exciting new exploration opportunity for
Centric Energy," said Alec Robinson, "and we look forward to
working closely with the Kenyan authorities, using modern
exploration technology to rigorously explore for hydrocarbons in
the Block."
The PSC is split into a seven-year exploration term, with three
periods, and a 25-year production term. In the first three-year
exploration period, Centric Energy will re-process and study
existing data and conduct geophysical and geological surveys
including gravity and magnetic surveys, and will acquire new 2D
seismic. The optional second and third periods are of two years
each and include obligations for the acquisition of 2D and 3D
seismic and the drilling of exploration wells.
Centric Energy's Block 10BA is strategically located within the
East African Rift System which is enjoying increasing exploration
interest and significant recent success, most notably in the
Albertine rift in Uganda, 660 km to the west which is considered to
be the closest geological analog to the Tertiary basins underlying
Block 10BA. Heritage Oil PLC (HOIL.L) and Tullow Oil PLC (TLW.L)
have discovered major volumes of hydrocarbons in the Albertine
rift, currently estimated to be more than 1 billion barrels
recoverable.
Block 10BA is relatively under-explored, with the most recent
seismic data acquired in 1991. It covers 16,205 square kilometers
(over 4,000,000 acres) in a part of the Rift System that includes
portions of several Tertiary-age rift sub-basins, including the
Kerio and Turkana basins and the northern part of the Lodwar basin.
The Loperot-1 well was drilled by Shell Exploration (Kenya) in 1992
in the southern part of the Lodwar basin, 75 km to the south of
Block 10BA, and encountered oil shows and mature source rocks,
demonstrating the presence of a petroleum system (source: Kenya
National Oil Corporation).
In addition, further exploration opportunities and upside
potential are provided by the Cretaceous-age Anza Graben, which
underlies the northern part of Block 10BA. A deep exploratory well
is currently being drilled by CNOOC (China National Offshore Oil
Corporation) in the southern part of the Anza Graben to the
southeast of Block 10BA.
An independent assessment of the prospective resources of Block
10BA has been completed by Gustavson & Associates under a
Resources Evaluation Report prepared in accordance with National
Instrument 51-101 - Standards for Disclosure for Oil and Gas
Activities. This report calculates prospective resources for 25
prospects in the Block. The total of the prospective resources
ranges from a low case (P90) of 955 million BOEs(i) up to a high
case (P10) of 4,379 million BOEs(i), with a best estimate (P50) of
2,188 million BOEs(i). The January 1, 2010, report entitled
"Resource Evaluation Report, Centric Energy Corporation, Kenya
Block 10BA" will be filed on SEDAR and will be accessible from
Centric's website at www.centricenergy.com. See definition of
"prospective resources" below.
The Company acquired the rights to be granted the concession
10BA Production Sharing Contract from an arm's length party
introduced to the Company and has agreed to pay, subject to receipt
of final approval from the TSX Venture Exchange, a total of
US$615,000 in acquisition costs and finder's fees.
The Company also announces its intention to carry out a
non-brokered private placement of up to 18,750,000 units at a price
of C$0.08 per unit for gross proceeds of up to C$1,500,000. Each
unit will consist of one common share and one common share purchase
warrant. Each common share purchase warrant will be exercisable to
purchase one additional common share at a price of C$0.12 per
common share for a period of 2 years subject to the Company's right
to accelerate the exercise of the common share purchase warrant if
the daily volume weighted average trading price of the common
shares of the Company on the TSX Venture Exchange is equal to or
exceeds C$0.20 per common share for a period of 10 consecutive
trading days between the period that is four months following
Closing and the expiry of the common share purchase warrants.
The proceeds of the private placement, will be used by the
Company to fund the costs associated with the initial 12 month
exploration work program on Block 10BA, required under the
Production Sharing Contract, and for general working capital.
The Private Placement and any finder's fees that may be payable,
will be subject to TSX Venture Exchange approval.
ON BEHALF OF CENTRIC ENERGY CORP.
Alec Robinson, President and Chief Executive Officer
(i) BOEs may be misleading, particularly if used in isolation. A
BOE conversion ratio of 6 MCF : 1 bbl is based on energy
equivalency conversion method primarily applicable at the burner
tip and does not represent value equivalency at the wellhead.
Prospective resources are defined as "those quantities of oil
and gas estimated on a given date to be potentially recoverable
from undiscovered accumulations. They are technically viable and
economic to recover." Note that the estimated prospective resources
disclosed in this news release could be oil or gas and that the
estimate does not include consideration for the risk of failure in
exploring for these resources. There is no certainty that any
portion of the resources will be discovered. If discovered, there
is no certainty that it will be commercially viable to produce any
portion of the resources.
This News Release does not constitute an offer to sell or a
solicitation of an offer to sell any securities in the United
States. The securities have not been and will not be registered
under the United States Securities Act of 1933, as amended (the
"U.S. Securities Act") or any state securities laws and may not be
offered or sold within the United States or to a U.S. Person unless
registered under the U.S. Securities Act and applicable state
securities laws or an exemption from such registration is
available.
Forward-Looking Statements:
This press release includes "forward-looking statements"
including forecasts, estimates, expectations and objectives for
future financing and exploration activities that are subject to a
number of assumptions, risks and uncertainties, many of which are
beyond the control of the Company. Statements regarding future
exploration activities and capital expenditures are subject to all
of the risks and uncertainties normally incident to the exploration
for and development and production of oil and gas. These risks
include, but are not limited to, inflation or lack of availability
of goods and services, environmental risks, drilling risks and
regulatory changes. Investors are cautioned that any such
statements are not guarantees of future performance and that actual
results or developments may differ materially from those projected
in the forward-looking statements. Statements regarding anticipated
financing activities are subject to all the risks and uncertainties
normally associated with fundraising by public companies. Such
forward-looking information represents management's best judgment
based on information currently available. No forward-looking
statement can be guaranteed and actual future results may vary
materially. The Company does not assume the obligation to update
any forward-looking statement except as required by applicable
law.
Neither the TSX Venture Exchange nor its Regulation Services
Provider accepts responsibility for the adequacy or accuracy of
this release.
Contacts: Centric Energy Corp. Alec E. Robinson Toll Free: +1
(800) 962-7189 or +44 207 222 8512 www.centricenergy.com
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