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CALGARY, Sept. 13, 2017 /CNW/ - Manitok Energy Inc.
("Manitok") (TSX-V: MEI) is pleased to announce that it has
entered into a definitive amalgamation agreement with Corinthian
Oil Corp. ("Corinthian") and 2065718 Alberta Inc., a wholly
owned subsidiary of Manitok ("Acquireco"), dated effective
September 12, 2017 (the
"Amalgamation Agreement") to acquire all of the issued and
outstanding shares of Corinthian (the "Transaction").
Manitok will acquire approximately 180 boe/d of production (25%
oil and liquids) with related oil battery and gas gathering system,
as well as over 120,000 acres of land including 100,000 acres of
net undeveloped land primarily located in the Heathdale area of
southern Alberta. The production
is mainly from the Colony, Glauconitic and Detrital
formations, on which Manitok has identified additional exploitation
opportunities. In addition to the production and land, there
is approximately $2.9 million of net
working capital, including $2.0
million of cash, which will increase Manitok's liquidity,
and not less than $5.0 million in
total tax pools. Based on the engineering report effective
December 31, 2016 prepared by GLJ
Petroleum Consultants Ltd., independent qualified reserves
evaluator of Corinthian, the total proved plus probable reserves
associated with the Heathdale property is approximately 1.85
million boe (24% oil and liquids).
The Transaction will be structured as a three-cornered
amalgamation pursuant to which Manitok will acquire all of the
issued and outstanding Corinthian common shares ("Corinthian
Shares") in exchange for Manitok common shares ("Manitok
Shares"), and Corinthian and Acquireco will amalgamate under
the name "Corinthian Oil Corp." ("Amalco") pursuant to the
provisions of the Business Corporations Act (Alberta). Amalco will be a wholly-owned
subsidiary of Manitok following the completion of the
Transaction.
Subject to certain adjustments contained in the Amalgamation
Agreement, an aggregate of $3,100,000
Manitok Shares are being issued to the holders of Corinthian Shares
("Corinthian Shareholders") at a deemed price of
$0.070486665 per Manitok Share (the
"Manitok Share Consideration"), being the five day volume
weighted average price of Manitok Shares prior to the execution of
the Amalgamation Agreement. Approximately 43,979,949 aggregate
Manitok Shares will be issued to the Corinthian Shareholders under
the Transaction.
Corinthian intends to obtain a unanimous written resolution of
Corinthian Shareholders approving the Transaction on or before
September 22, 2017. In the event that
such written resolution cannot be obtained by September 22, 2017, Corinthian will call a
special meeting of the Corinthian Shareholders to approve the
Transaction (the "Corinthian Meeting"). In the event that
the Corinthian Meeting is called to approve the Transaction, the
Manitok Share Consideration will be adjusted to the five day volume
weighted average price of Manitok Shares prior to the date of the
Corinthian Meeting.
Closing of the Transaction will occur as soon as possible upon
all of the conditions contained in the Amalgamation Agreement being
satisfied or waived, including obtaining all consents, approvals
and authorizations (including, without limitation, all stock
exchange, securities commission and other regulatory approvals)
required or necessary in connection with the Transaction, including
the approval of the Transaction by the Corinthian Shareholders. A
copy of the Amalgamation Agreement will be available under
Manitok's SEDAR profile at www.sedar.com.
About Manitok
Manitok is a public oil and gas exploration and development
corporation focusing on conventional oil and gas reservoirs in the
Canadian foothills and southeast Alberta. Manitok will utilize its experience
to develop the untapped conventional oil and liquids-rich natural
gas pools in both the foothills and southeast Alberta areas of the Western Canadian
Sedimentary Basin.
Forward-looking Information Cautionary Statement
This press release contains forward-looking statements. More
particularly, this press release contains statements concerning the
terms and anticipated timing of the Transaction and the anticipated
benefits of the Transaction to Manitok.
The forward-looking statements in this press release are
based on certain key expectations and assumptions made by Manitok,
including expectations and assumptions concerning the prevailing
market conditions, commodity prices, and the availability of
capital.
Although Manitok believes that the expectations and
assumptions on which the forward-looking statements are based are
reasonable, undue reliance should not be placed on the
forward-looking statements because Manitok can give no assurance
that they will prove to be correct. Since forward-looking
statements address future events and conditions, by their very
nature they involve inherent risks and uncertainties. Actual
results could differ materially from those currently anticipated
due to a number of factors and risks. These include, but are not
limited to, risks associated with adverse market conditions, the
inability of Manitok to complete the Transaction at all or on the
terms announced, not obtaining the required court, shareholder and
regulatory approvals and the risks associated with the oil and gas
industry in general (e.g., operational risks in development,
exploration and production; delays or changes in plans with respect
to exploration or development projects or capital expenditures; the
uncertainty of reserves estimates; the uncertainty of estimates and
projections relating to production, costs and expenses; and health,
safety and environmental risks), uncertainty as to the availability
of labour and services, commodity price and exchange rate
fluctuations, unexpected adverse weather conditions, general
business, economic, competitive, political and social
uncertainties, capital market conditions and market prices for
securities and changes to existing laws and regulations. More
information about certain of these risks are set out in the
documents filed from time to time with the Canadian securities
regulatory authorities, available on Manitok's SEDAR profiles at
www.sedar.com.
Barrels of Oil Equivalent
The term barrels of oil equivalent ("boe") may be
misleading, particularly if used in isolation. Per boe amounts have
been calculated using a conversion ratio of six thousand cubic feet
(6 mcf) of natural gas to one barrel (1 bbl) of crude oil.
The boe conversion ratio of 6 mcf to 1 bbl 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
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 Manitok Energy Inc.