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CALGARY, July 12, 2017 /CNW/ - Petro-Victory Energy
(TSX-V: VRY), ("Petro-Victory" or the "Company"), is pleased to
announce the proposed acquisition of a portfolio of non-operated
production interests in Brazil
from Empresa de Engenharia de Petróleo Ltda. ("ENGEPET") for an
aggregate of US$1.9 million (the
"Acquisition") to complement the current royalty interests in
Paraguay.
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Subject to approval from Agencia Nacional do Petroleo Gas
Natural e Biocombustiveis of Brazil ("ANP") and the TSX Venture Exchange
Inc. ("TSX Venture"), Petro-Victory will acquire certain working
interests in Brazil comprising
12,850 gross acres across 3 basins with 2017 year end production
estimated to be between 70-90 bopd net to Petro-Victory including:
(a) a 50% equity in the Carapitanga onshore producing oil field in
the Sergipe Basin; (b) a 30% equity in the Andorinha onshore
producing oil field in the Potiguar Basin; (c) a 50% equity in the
São João onshore oil field in the Barreirinhas Basin; and (d) a
30% equity in the Alto Alegre onshore oil field in the Potiguar
Basin.
The consideration, US$0.9 million,
includes all associated acquisition costs and US$1 million contribution to the upcoming capital
expenditure program for the four concessions.
Local Brazilian Partner
Upon completion of the acquisition, Petro-Victory will enter
into a partnership with ENGEPET (who will retain the remaining
equity in all 4 concessions) where the two companies will work
closely together to achieve the production goals set by both
parties. ENGEPET is a Brazilian operating company with oil fields
and service contracts across Brazil. ENGEPET currently operates their own
oil and gas fields, as well as operating a number of oil fields for
companies including Petrobras and GALP. ENGEPET maintain a strong
relationship with ANP and Petrobras through their experienced staff
and successful track record of developing oil fields throughout
Brazil and are the ideal local
operating partner for Petro-Victory as they enter into this new
phase for the company.
Financing of the Transaction
In order to finance the Acquisition and upcoming expenditure
program, Petro-Victory intends to complete a non-brokered private
placement offering of common shares at a price of $0.05 per share for gross proceeds of up to
CAD$4,000,000 (the "Offering"). No
finder's fees are expected to be paid in connection with the
Offering. All securities issued in connection with the Offering
will be subject to a hold period of four months and one day from
the date of closing. The net proceeds from the Offering will be
used for the Brazil acquisition
and general corporate purposes. Depending on market conditions, the
Company reserves the right to increase the maximum gross proceeds
under the Offering, subject to the approval of the TSX Venture.
Future News Flow
Following closing of the Acquisition (expected to close in
August), the Company will release further information on its plans
for the fields in the short and long term, including information on
the estimated oil reserves, production forecasts, and future work
programs. In the view of management all 4 oil fields have
significant potential and will provide the Company with numerous
opportunities to increase production going forward.
Further evaluations are currently ongoing on various new
ventures and opportunities in Brazil, and the Company will update the market
on further progress of these evaluations as they advance.
Message from the CEO
Richard Gonzalez, CEO, made the
following comment: "We are very pleased to announce the acquisition
of four oil fields located in Brazil. On completion, this acquisition will
transform Petro-Victory into an oil producing company from day one.
All four fields will offer Petro-Victory quick payback, positive
cash flow, and certified reserves. Petro-Victory will now have a
cash-flowing production base in Brazil that can be readily grown through
low-risk development with our local partners. The acquisition of a
low-risk, producing portfolio is a significant milestone for
Petro-Victory. We will update the market on a regular basis as we
progress on these fields and on a number of other opportunities
that we are evaluating."
This press release does not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of
these securities, in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of such jurisdiction.
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 unless an exemption from such registration is
available.
Cautionary Note
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.
Advisory Regarding Forward-Looking Statements
In the interest of providing Petro-Victory's shareholders and
potential investors with information regarding Petro-Victory,
including management's assessment of Petro-Victory's future plans
and operations, certain statements in this press release are
"forward-looking statements" within the meaning of the United
States Private Securities Litigation Reform Act of 1995 and
"forward-looking information" within the meaning of applicable
Canadian securities legislation (collectively, "forward-looking
statements"). In some cases, forward-looking statements can be
identified by terminology such as "anticipate", "believe",
"continue", "could", "estimate", "expect", "forecast", "intend",
"may", "objective", "ongoing", "outlook", "potential", "project",
"plan", "should", "target", "would", "will" or similar words
suggesting future outcomes, events or performance. The
forward-looking statements contained in this press release speak
only as of the date thereof and are expressly qualified by this
cautionary statement.
Specifically, this press release contains forward-looking
statements relating to but not limited to: the offering, our
business strategies, oil and gas production, plans and objectives,
and drilling, testing and exploration expectations. These
forward-looking statements are based on certain key assumptions
regarding, among other things:, the completion of the offering; our
ability to add production and reserves through our exploration
activities; the receipt, in a timely manner, of regulatory and
other required approvals for our operating activities; the
availability and cost of labor and other industry services; the
continuance of existing and, in certain circumstances, proposed tax
and royalty regimes; and current industry conditions, laws and
regulations continuing in effect (or, where changes are proposed,
such changes being adopted as anticipated). Readers are cautioned
that such assumptions, although considered reasonable by
Petro-Victory at the time of preparation, may prove to be
incorrect.
Actual results achieved will vary from the information
provided herein as a result of numerous known and unknown risks and
uncertainties and other factors. These and additional risk factors
are discussed in our Final Prospectus dated July 11, 2014, as filed with Canadian securities
regulatory authorities at www.sedar.com.
The above summary of assumptions and risks related to
forward-looking statements in this press release has been provided
in order to provide shareholders and potential investors with a
more complete perspective on Petro-Victory's current and future
operations and such information may not be appropriate for other
purposes. There is no representation by Petro-Victory that actual
results achieved will be the same in whole or in part as those
referenced in the forward-looking statements and Petro-Victory does
not undertake any obligation to update publicly or to revise any of
the included forward-looking statements, whether as a result of new
information, future events or otherwise, except as may be required
by applicable securities law.
Not for distribution to U.S. Newswire Services or for
dissemination in the United
States. Any failure to comply with this restriction may
constitute a violation of U.S. securities laws.
SOURCE Petro-Victory Energy Corp.