Madalena Ventures Inc. Strategically Enters the North American Oil & Gas Sector with the Acquisition of Online Energy Inc.
04 Settembre 2012 - 1:30PM
PR Newswire (Canada)
/NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR
DISSEMINATION IN THE UNITED STATES/ MADALENA VENTURES INC. 200, 441
- 5(th) Avenue S.W. Calgary, Alberta T2P 2V1 Telephone: (403)
233-8010 Facsimile (403) 233-8013 TSXV Trading Symbol: MVN ONLINE
ENERGY INC. 200, 707 - 7(th) Avenue S.W. Calgary, Alberta T2P 3H6
Telephone: (403) 262-1901 Facsimile (403) 262-1905 TSXV
Trading Symbol: ONL CALGARY, Sept. 4, 2012 /CNW/ - Madalena
Ventures Inc. ("Madalena") , an international upstream oil and gas
company and Online Energy Inc. ("Online") , a domestic oil and gas
company with operations in Alberta, are pleased to jointly announce
that they have entered into a pre-acquisition agreement (the
"Pre-Acquisition Agreement") pursuant to which Madalena will,
subject to certain conditions, make an offer to acquire all of the
issued and outstanding common shares of Online ("Online Shares") by
way of a take-over bid (the "Offer"). Under the terms of the
Pre-Acquisition Agreement, Madalena will pay $0.35 cash per Online
Share for a total purchase price of $20.3 million, which includes
the assumption of Online's debt in the amount of approximately $4.0
million excluding transaction costs and severance. Based on
the 20 day volume weighted average trading price of the Online
Shares on the TSXV ending August 31, 2012, Online's shareholders
will receive a 52% premium for each Online Share held.
Madalena intends to fund the purchase price from its current
working capital. Online is a junior exploration and production
company which currently operates exclusively in Alberta,
Canada. Its assets include 145 net sections of land (net
76.4% average working interest) in the Paddle River area of central
Alberta across multiple light oil and liquids-rich gas resource
plays. Online's resource plays are highlighted by the
Ostracod light oil (43 of the 145 net sections) and Nordegg light
oil and liquids-rich gas (131 of the 145 net sections) plays, and
are complemented by the Rock Creek, Notikewan, Wilrich and Duvernay
oil and liquids-rich gas plays. Online has current production
of approximately 400 boe/d (37% oil and liquids, 63% natural gas)
and anticipates the recently completed Paddle River 1-5-56-7W5M
Ostracod horizontal oil well will commence production on or around
September 15, 2012 at an initial rate of approximately 400 boe/d
(80% oil and liquids). This strategic acquisition positions
Madalena to enter the North American oil and gas sector and obtain
a source of cash flow from production along with access to a large
inventory of horizontal drilling locations. The acquisition
also allows Madalena the ability to re-deploy capital, where
required, as international and domestic economic conditions evolve
in its core operating areas. Transaction Overview The transaction
is expected to be highly accretive to Madalena on a per share basis
to cash flow, reserves and production and has the following
characteristics and metrics: Total Purchase Price(1) $20.3 million
Estimated Online Daily Production (Q4 2012 Average(2)) 675 boe/d
(53% oil and liquids) Estimated Online Daily Production
(Current(3)) 800 boe/d (58% oil and liquids) Reserves(4) Total
Proved 1,082 MBOE Total Proved Plus Probable 1,436 MBOE Land 145
net sections (92,800 net acres) Ascribed Land Value(5) $7.6 million
Acquisition Metrics Q4/12E $/average daily boe(2)(6) $18,815
Current $/average daily boe(3)(6) $15,875 $/boe Total Proved(4)(7)
$18.76 $/boe Proved Plus Probable(4)(7) $14.14 Notes: 1. Assuming a
cash price per Online Share of $0.35, the assumption of Online's
debt in the amount of $4.0 million (and excluding transaction costs
and severance) and that 46,558,859 Online Shares are acquired under
the Offer after the exercise of the in-the-money stock options of
Online. 2. Average daily production of Online estimated as of Q4/12
and based on 400 boe/d initial production from the Paddle River 1-5
Ostracod horizontal well. 3. Current estimated average daily
production of Online including 400 boe/d initial production from
the Paddle River 1-5 Ostracod horizontal well. 4. Reserves
evaluated by McDaniel & Associates Consultants Ltd.
("McDaniel") in the report of McDaniel dated February 2, 2012 and
effective as at December 31, 2011 (the "McDaniel Report"). Reserves
are "gross reserves", being Online's working interest share of
reserves before the deduction of royalties owned by others and
without including royalty interests of Online. 5. Assumes $100/acre
of undeveloped land and 75,855 net acres undeveloped. 6. Metrics
per flowing barrel equivalent exclude the ascribed land value of
$7.6 million from the total transaction value of $20.3 million 7.
Excluding the future development capital estimated by McDaniel of
$0.31 million for the proved reserves and $0.59 million for the
proved plus probable reserves. The Paddle River 1-5 well was
Online's second Ostracod horizontal well. In July 2012 the
well tested at an average rate of 438 boe/d (73% oil) over a
three-day period following a fourteen stage frac completion and
further supports the potential of its emerging oil resource play at
Paddle River. This well is currently awaiting tie-in and is
expected to be on production by September 15, 2012. While there
currently is not an established decline curve for the Ostracod
horizontal oil project due to the lack of data, Online has budgeted
that the 1-5 well is expected to decline approximately 50% from its
initial rate by December 31, 2012. No reserves have been
attributed to this second Ostracod well in the McDaniel Report,
however, management of Madalena expects reserve additions for this
well to be reflected in Madalena's year-end reserve report assuming
the well performs as anticipated following tie-in. Further,
the McDaniel Report attributed little value to Online's developing
horizontal resource plays which management of Online and Madalena
believe could potentially support up to 50 Ostracod drilling
locations. Madalena Strategic Rationale The acquisition of Online
is expected to have the following benefits for Madalena: --
Provides entry into the domestic E&P space with the opportunity
to ramp production and cash flow while continuing to develop and
grow its international assets & business plan -- High working
interest ownership and operatorship of a sizeable domestic land
base with a large inventory of potential oil and liquids-rich
natural gas locations -- Increases critical mass for continuing
operations and the opportunity to transfer North America technology
and engineering techniques to other international resource plays --
Continues to build on the recent Ostracod oil success of Online and
allows Madalena to further direct capital into two significant and
emerging oil resource plays in both the Ostracod & Nordegg Oil
-- Increases total proved reserves of Madalena by 124% from 874
MBOE to 1,955 MBOE(1) -- Increases total proved plus probable
reserves of Madalena by 92% from 1,565 MBOE to 3,001 MBOE(1) Notes:
1. Based on the addition of Online's proved and proved plus
probable reserves effective as of December 31, 2011 as set forth in
the McDaniel Report to Madalena's proved and proved plus probable
reserves evaluated by InSite Petroleum Consultants effective as of
December 31, 2011. Reserves are "gross reserves", being each
company's working interest share of reserves before the deduction
of royalties owned by others and without including royalty
interests of each company. Pre-Acquisition Agreement Under the
terms of the Pre-Acquisition Agreement, the Offer is subject to a
number of conditions including the tendering of at least 66(2/3)%
of the outstanding Online Shares to the Offer, the receipt of all
necessary regulatory and stock exchange approvals and other
customary closing conditions. Online has agreed that it will
not solicit or initiate any discussion with any third party
concerning the sale of a material portion of the assets of Online
or any business combination involving Online and has granted
Madalena the right to match any subsequent proposal.
Additionally, a non-completion fee in the amount of $1 million is
payable by Madalena or Online in certain cases involving the
termination of the Pre-Acquisition Agreement. Madalena anticipates
mailing the Offer to all registered Online shareholders on or
before September 26, 2012 and the Offer will expire 35 days
thereafter unless otherwise extended by Madalena in accordance with
the terms of the Pre-Acquisition Agreement. Addition to Madalena
Management Team Mr. Dwayne Warkentin, alongside Madalena's current
management team & board of directors, will continue to lead the
overall entity focused on continued growth both internationally and
domestically. Online's current President and CEO, Steve
Dabner - P. Geol, has agreed to employment with Madalena in the
position of Vice-President, Exploration following the completion of
the Offer. Mr. Dabner has over 27 years experience in the oil
and gas industry and in that capacity will play a significant role
in heading up Madalena's domestic operations and will provide
Madalena with the necessary leadership and expertise needed to grow
the emerging resource plays at Paddle River. Fairness Opinions,
Recommendations and Lock-up Agreements The board of directors of
Madalena has approved the Pre-Acquisition Agreement and the
Offer. Casimir Capital Ltd. is acting as the sole financial
advisor to Madalena, and has provided the board of directors of
Madalena with its opinion, pending review of the finalized form of
documents effecting the Transaction, that the consideration to be
paid by Madalena pursuant to the Offer is fair, from a financial
point of view, to Madalena shareholders. Online's board of
directors has also approved the Pre-Acquisition Agreement and the
Offer and has retained Emerging Equities Inc. to be its sole
financial advisor with respect to the Offer. Emerging
Equities Inc. has provided the board of directors of Online with
its opinion that the consideration to be received by the Online
shareholders pursuant to the Offer is fair, from a financial point
of view, to the Online shareholders. Holders of Online Shares
(including all directors and officers of Online), holding an
aggregate of approximately 10.2% of the outstanding Online Shares
have entered into lock-up agreements with Madalena pursuant to
which they have agreed to tender their Online Shares to the Offer.
Madalena International Update Madalena, which holds three large
blocks / concessions within the prolific Neuquen basin in
Argentina, continues to move forward on both its conventional
opportunities, alongside its continued prove-up of its
large-in-place oil & gas resources within both the
unconventional Vaca Muerta shale and emerging Agrio shale
plays. Madalena holds 135,000 net acres held across the
Coiron Amargo (35,027 net acres), Curamhuele (50,400 net acres) and
Cortadera (49,600 net acres) blocks. A drilling rig is
expected to return to the Coiron Amargo Block later this month to
drill one additional development well on Coiron Amargo Norte and
one exploration well on Coiron Amargo Sur. The exploration
well is located approximately 10km west of the CAS X-2 well near a
previous well drilled on the block that during drilling indicated
extensive natural fracturing in the Vaca Muerta formation. Reader
Advisories The information in this news release contains certain
forward-looking statements. These statements relate to future
events or our future performance. All statements other than
statements of historical fact may be forward-looking statements.
Forward-looking statements are often, but not always, identified by
the use of words such as "seek", "anticipate", "plan", "continue",
"estimate", "approximate", "expect", "may", "will", "project",
"predict", "potential", "targeting", "intend", "could", "might",
"should", "believe", "would" and similar expressions. In
particular, this news release contains forward-looking statements
pertaining to: (i) estimated Q4 2012 production for Online; (ii)
the anticipated tie-in date of the Paddle River 1-5 well and the
anticipated performance therefrom (including anticipated initial
production and decline rate) and the potential reserve additions
therefrom; (iii) the mailing of a takeover bid circular by
Madalena; and (iv) operational activities to be conducted in
Argentina by Madalena. These statements involve substantial
known and unknown risks and uncertainties, certain of which are
beyond the control of Madalena and Online, including: the impact of
general economic conditions; industry conditions; changes in laws
and regulations including the adoption of new environmental laws
and regulations and changes in how they are interpreted and
enforced; fluctuations in commodity prices and foreign exchange and
interest rates; stock market volatility and market valuations;
volatility in market prices for oil and natural gas; liabilities
inherent in oil and natural gas operations; uncertainties
associated with estimating oil and natural gas reserves;
competition for, among other things, capital, acquisitions, of
reserves, undeveloped lands and skilled personnel; incorrect
assessments of the value of acquisitions; changes in income tax
laws or changes in tax laws and incentive programs relating to the
oil and gas industry ; geological, technical, drilling and
processing problems and other difficulties in producing petroleum
reserves; and obtaining required approvals of regulatory
authorities. The Company's actual results, performance or
achievement could differ materially from those expressed in, or
implied by, such forward-looking statements and, accordingly, no
assurances can be given that any of the events anticipated by the
forward-looking statements will transpire or occur or, if any of
them do, what benefits that Madalena and Online will derive from
them. These statements are subject to certain risks and
uncertainties and may be based on assumptions that could cause
actual results to differ materially from those anticipated or
implied in the forward-looking statements. The forward-looking
statements in this news release are expressly qualified in their
entirety by this cautionary statement. Except as required by law,
Madalena and Online undertake no obligation to publicly update or
revise any forward-looking statements. Investors are
encouraged to review and consider the additional risk factors set
forth in the annual information form of each of Madalena and
Online, which are available on SEDAR at www.sedar.com. Any
references in this news release to test rates, flow rates, initial
and/or final raw test or production rates, early production and/or
"flush" production rates are useful in confirming the presence of
hydrocarbons, however, such rates are not necessarily indicative of
long-term performance or of ultimate recovery. Such rates may
also include recovered "load" fluids used in well completion
stimulation. Readers are cautioned not to place reliance on such
rates in calculating the aggregate production for Madalena.
In addition, the Vaca Muerta shale is an unconventional resource
play which may be subject to high initial decline rates. All
calculations converting natural gas to barrels of oil equivalent
("boe") have been made using a conversion ratio of six thousand
cubic feet (six "Mcf") of natural gas to one barrel of oil, unless
otherwise stated. The use of boe may be misleading, particularly if
used in isolation, as the conversion ratio of six Mcf of natural
gas to one barrel of oil is based on an energy equivalency
conversion method primarily applicable at the burner tip and does
not represent a value equivalency at the wellhead. Given that
the value ratio based on the current price of crude oil as compared
to natural gas is significantly different from the energy
equivalency of 6:1, utilizing a conversion on a 6:1 basis may be
misleading as an indication of value. Neither the TSX Venture
Exchange nor its Regulation Service Provider (as that term is
defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
Madalena Ventures Inc. CONTACT: Dwayne H. Warkentin President and
Chief Executive Officer Madalena Ventures Inc. Phone: (403)
233-8010 ext 229 Anthony J. PotterVice President, Finance and Chief
Financial OfficerMadalena Ventures Inc.Phone: (403) 233-8010 ext
233Steve Dabner President and Chief Executive Officer Online Energy
Inc. Phone: (403) 262-1901 ext 228 Thomas LoveChief Financial
OfficerOnline Energy Inc.Phone: (403) 262-1901 ext 227
Copyright
Grafico Azioni Online Energy (TSXV:ONL)
Storico
Da Mag 2024 a Giu 2024
Grafico Azioni Online Energy (TSXV:ONL)
Storico
Da Giu 2023 a Giu 2024