CALGARY, ALBERTA–(Marketwired – March 30, 2016) – Seven Generations Energy Ltd. (TSX:VII) has completed the construction and commissioning of its Cutbank processing plant at the Company’s Kakwa River Project in northwest Alberta.
The Cutbank plant is designed to process 250 million cubic feet per day (MMcf/d) of liquids-rich natural gas. With the addition of the Cutbank plant, production volumes in 2016 are expected to grow as additional wells are brought on-stream. 7G expects to produce an average of between 100,000 and 110,000 barrels of oil equivalent per day and plans capital investment of $900 million to $950 million in 2016.
Cutbank was brought on-stream about a week early and about 18 percent under budget. When combined with the expansion in late 2015 of 7G’s Lator processing complex, Cutbank takes liquids-rich natural gas processing capacity to approximately 510 MMcf/d at the Kakwa River Project. The Cutbank plant project included the construction of field gathering pipelines and a 29-kilometre, 24-inch diameter natural gas sales pipeline that connects Cutbank to the Alliance Pipeline for the delivery of liquids-rich natural gas to the Chicago-area market.
Seven Generations Energy
Seven Generations is a low-supply-cost, high-growth Canadian natural gas developer generating long-life value from its liquids-rich Kakwa River Project, located about 100 kilometres south of its operations headquarters in Grande Prairie, Alberta. 7G’s corporate headquarters are in Calgary and its shares trade on the TSX under the symbol VII.
Further information about Seven Generations is available on the Company’s website: www.7genergy.com.
Reader Advisory
This news release contains certain forward-looking information and statements that involves various risks, uncertainties and other factors. The use of any of the words “anticipate”, “continue”, “estimate”, “expect”, “may”, “will”, “should”, “believe”, “plans”, and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the foregoing, this news release contains forward-looking information and statements pertaining to the following: anticipated growth; expected processing capacity; anticipated production growth; production guidance; and the ability to generate long-life value from the Kakwa River Project.
With respect to forward-looking information contained in this news release, assumptions have been made regarding, among other things: future oil, natural gas liquids and natural gas prices; the Company’s ability to obtain qualified staff and equipment in a timely and cost efficient manner; the Company’s ability to market production of oil, natural gas and natural gas liquids successfully to customers; the Company’s future production levels; the applicability of technologies for the Company’s reserves; future capital investments by the Company; future funds from operations from production; future sources of funding for the Company’s capital program; the Company’s future debt levels; geological and engineering estimates in respect of the Company’s reserves and resources; the geography of the areas in which the Company is conducting exploration and development activities; the access, economic and physical limitations to which the Company may be subject from time to time; the impact of competition on the Company; and the Company’s ability to obtain financing on acceptable terms.
Actual results could differ materially from those anticipated in the forward-looking information as a result of the risks and risk factors that are set forth in the Company’s Annual Information Form dated March 8, 2016, which is available on SEDAR at www.sedar.com, including, but not limited to: volatility in market prices and demand for oil, natural gas liquids and natural gas and hedging activities related thereto; general economic, business and industry conditions; variance of the Company’s actual capital costs, operating costs and economic returns from those anticipated; risks related to the exploration, development and production of oil and natural gas reserves and resources; negative public perception of oil sands development, oil and natural gas development and transportation, hydraulic fracturing and fossil fuels; actions by governmental authorities, including changes in government regulation, royalties and taxation; the management of the Company’s growth; the availability, cost or shortage of rigs, equipment, raw materials, supplies or qualified personnel; the absence or loss of key employees; uncertainty associated with estimates of oil, natural gas liquids and natural gas reserves and resources and the variance of such estimates from actual future production; dependence upon compressors, gathering lines, pipelines and other facilities, certain of which the Company does not control; the ability to satisfy obligations under the Company’s firm commitment transportation arrangements; uncertainties related to the Company’s identified drilling locations; the concentration of the Company’s assets in the Kakwa area; unforeseen title defects; Aboriginal claims; failure to accurately estimate abandonment and reclamation costs; changes in the interpretation and enforcement of applicable laws and regulations; terrorist attacks or armed conflicts; natural disasters; reassessment by taxing authorities of the Company’s prior transactions and filings; variations in foreign exchange rates and interest rates; third-party credit risk including risk associated with counterparties in risk management activities related to commodity prices and foreign exchange rates; sufficiency of insurance policies; potential for litigation; variation in future calculations of certain financial measures; sufficiency of internal controls; impact of expansion into new activities on risk exposure; risks related to the senior unsecured notes and other indebtedness, including: potential inability to comply with the covenants in the credit agreement related to the Company’s credit facilities and/or the covenants in the indentures in respect of the Company’s senior secured notes; seasonality of the Company’s activities and the Canadian oil and gas industry; weather related risks, fires and natural disasters, and extensive competition in the Company’s industry.
The forward-looking information and statements contained in this news release speak only as of the date hereof, and the Company does not assume any obligation to publicly update or revise them to reflect new events or circumstances, except as may be required pursuant to applicable laws.
Seven Generations has adopted the standard of six thousand cubic feet (Mcf) to one barrel (bbl) (6 Mcf:1 bbl) when converting natural gas to barrels of oil equivalent (boes). Condensate and other natural gas liquids are converted to boes at a ratio of 1 bbl:1 bbl. Boes may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf:1 bbl is based roughly on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the Company’s sales point. Given the value ratio based on the current price of oil as compared to natural gas is significantly different from the energy equivalency of 6 Mcf: 1 bbl, utilizing a conversion ratio at 6 Mcf: 1 bbl may be misleading as an indication of value.
Seven Generations Energy Ltd. is referred to herein as Seven Generations, Seven Generations Energy, 7G and the Company.
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CALGARY, AB–(Marketwired – March 30, 2016) – (TSX: ECA) (NYSE: ECA)
Encana Corporation (“Encana” or the “Company”) today announced the early tender results of its previously announced offers to purchase for cash (collectively, the “Tender Offers” and each a “Tender Offer”) its outstanding senior notes listed in the table below (collectively, the “Notes”). The Company further announced that it has increased the aggregate amount that holders of the Notes are entitled to receive in the Tender Offers, excluding accrued and unpaid interest, from $250,000,000 to $400,000,000 (the “Aggregate Maximum Tender Amount”). Except for such increase in the Aggregate Maximum Tender Amount, all other terms and conditions of the Tender Offers remain unchanged. The Tender Offers are being made pursuant to the Company’s Offer to Purchase dated March 16, 2016 (the “Offer to Purchase”) and the related Letter of Transmittal (together with the Offer to Purchase, the “Offer Documents”), which set forth in detail the terms and conditions of the Tender Offers.
The aggregate principal amounts of Notes validly tendered at or prior to 5:00 p.m., New York City time, on March 29, 2016 (the “early tender date”) are specified in the table below.
| Title of Notes | CUSIP Number | Principal Amount Outstanding | Acceptance Priority Level | Aggregate Principal Amount Tendered | Aggregate Principal Amount Accepted | Approximate Proration Factor | Total Consideration (per $1,000 Principal Amount of Notes Accepted) | |||||||
| 5.15% Senior Notes due 2041 | 292505AK0 | $400,000,000 | 1 | $156,026,000 | $156,026,000 | 100% | $750.00 | |||||||
| 6.50% Senior Notes due 2038 | 292505AG9 | $800,000,000 | 2 | $295,181,000 | $295,181,000 | 100% | $850.00 | |||||||
| 6.625% Senior Notes due 2037 | 292505AE4 | $500,000,000 | 3 | $120,427,000 | $37,737,000 | 31.3% | $850.00 | |||||||
| 6.50% Senior Notes due 2034 | 292505AD6 | $750,000,000 | 4 | $196,172,000 | $0 | 0% | $850.00 | |||||||
As a result of the increase in the Aggregate Maximum Tender Amount, and in accordance with the acceptance priority levels specified in the table above and on the cover page of the Offer to Purchase, (i) all the 5.15% Senior Notes due 2041 and 6.50% Senior Notes due 2038 that were validly tendered at or prior to the early tender date will be accepted for purchase by the Company on March 30, 2016 (the “early settlement date”), (ii) the 6.625% Senior Notes due 2037 that were validly tendered at or prior to the early tender date will be prorated (at an approximate proration factor as specified in the table above) and accepted for purchase by the Company on the early settlement date and (iii) none of the 6.50% Senior Notes due 2034 that were validly tendered at or prior to the early tender date will be accepted for purchase by the Company. The Company reserves the right, but is under no obligation, to further increase the Aggregate Maximum Tender Amount at any time, subject to applicable law. If the Company further increases the Aggregate Maximum Tender Amount, it does not expect to extend the withdrawal deadline, which expired at 5:00 p.m., New York City time, on March 29, 2016 (the “withdrawal deadline”), subject to applicable law. Therefore, any Notes tendered prior to or after the withdrawal deadline may not be withdrawn unless otherwise required by applicable law.
The consideration for each $1,000 principal amount of Notes validly tendered and accepted for purchase on the early settlement date pursuant to the Tender Offers will be the applicable Total Consideration set forth in the table above, which includes an early tender premium of $30 per $1,000 principal amount of Notes accepted for purchase. All Notes validly tendered and accepted for purchase on the early settlement date will also receive accrued and unpaid interest on such Notes from the last interest payment date with respect to those Notes to, but not including, the early settlement date. All Notes purchased in the Tender Offers will be retired and cancelled by the Company.
The Tender Offers will expire at 12:00 midnight, New York City time, on April 12, 2016 (one minute after 11:59 p.m., New York City time, on April 12, 2016), unless extended by the Company (the “expiration date”). Unless the Company further increases the Aggregate Maximum Tender Amount prior to the expiration date, no Notes tendered after the early tender date will be accepted for purchase pursuant to the Tender Offers. If the Company further increases the Aggregate Maximum Tender Amount, the Company will purchase any Notes that have been validly tendered in the Tender Offers at or prior to the expiration date promptly following the expiration date, subject to the acceptance priority level, Aggregate Maximum Tender Amount, proration and other terms and conditions of the Tender Offers. The final settlement date, if any, is expected to occur on the first business day following the expiration date.
The Company’s obligation to accept for purchase, and to pay for, Notes validly tendered in the Tender Offers is subject to, and conditioned upon, the satisfaction or waiver of certain conditions described in the Offer Documents.
The Company is funding the Tender Offers, including accrued and unpaid interest and fees and expenses payable in connection with the Tender Offers, with cash on hand and borrowings under its revolving credit facility.
Citigroup Global Markets Inc. (“Citigroup”) and Mitsubishi UFJ Securities (USA), Inc. (“MUFG”) are the Dealer Managers in the Tender Offers. Global Bondholder Services Corporation is the Depositary and Information Agent for the Tender Offers. Persons with questions regarding the Tender Offers should contact Citigroup at (toll free) (800) 558-3745 or (collect) (212) 723-6106 or MUFG at (toll free) (877) 744-4532 or (collect) (212) 405-7481. Request for the Offer Documents should be directed to Global Bondholder Services Corporation at (toll free) (866) 470-4300 or (collect) (212) 430-3774.
This news release shall not constitute an offer to sell, a solicitation to buy or an offer to purchase or sell any securities. The Tender Offers are being made only pursuant to the Offer Documents and only in such jurisdictions as is permitted under applicable law. In any jurisdiction in which the Tender Offers are required to be made by a licensed broker or dealer, the Tender Offers will be deemed to be made on behalf of the Company by the Dealer Managers, or one or more registered brokers or dealers that are licensed under the laws of such jurisdiction.
All dollar amounts in this news release are expressed in U.S. dollars.
DISCLAIMER
This news release must be read in conjunction with the Offer Documents. This news release and the Offer Documents contain important information which must be read carefully before any decision is made with respect to the Tender Offers. If any holder of Notes is in any doubt as to the action it should take, it is recommended to seek its own legal, tax, accounting and financial advice, including as to any tax consequences, immediately from its stockbroker, bank manager, attorney, accountant or other independent financial or legal adviser. Any individual or company whose Notes are held on its behalf by a broker, dealer, bank, custodian, trust company or other nominee or intermediary must contact such entity if it wishes to participate in the Tender Offers. None of the Company, its Board of Directors, the Dealer Managers, the Depositary and Information Agent, the trustee with respect to the Notes, or any of the Company’s or their respective affiliates, is making any recommendation as to whether holders should tender any Notes in response to the Tender Offers. Holders must make their own decision as to whether to participate in the Tender Offers, and, if so, the principal amount of Notes to tender.
Encana Corporation
Encana Corporation is a leading North American energy producer that is focused on developing its strong portfolio of resource plays, held directly and indirectly through its subsidiaries, producing natural gas, oil and natural gas liquids. By partnering with employees, community organizations and other businesses, Encana contributes to the strength and sustainability of the communities where it operates. Encana common shares trade on the Toronto and New York stock exchanges under the symbol ECA.
ADVISORY REGARDING FORWARD-LOOKING STATEMENTS – This news release contains certain forward-looking statements or information within the meaning of applicable securities legislation. Forward-looking statements include: statements regarding the terms and timing for completion of the Tender Offers, including the acceptance for purchase of any Notes validly tendered and the expected expiration date and final settlement date thereof; any potential additional increase to the Aggregate Maximum Tender Amount; the withdrawal deadline will not be extended; and the satisfaction or waiver of certain conditions of the Tender Offers.
Readers are cautioned against unduly relying on forward-looking statements which, by their nature, involve numerous assumptions, risks and uncertainties that may cause such statements not to occur, or results to differ materially from those expressed or implied. Risks and uncertainties that may affect these business outcomes include: risks related to the successful consummation of the Tender Offers; risk and effect of a downgrade in the Company’s credit rating, including below an investment-grade credit rating, and its impact on access to capital markets and other sources of liquidity; fluctuations in currency and interest rates; changes in or interpretation of laws or regulations; and other risks and uncertainties impacting the Company’s business as described from time to time in its most recent management discussion and analysis, financial statements, Annual Information Form and Form 40-F, as filed on SEDAR and EDGAR.
Although the Company believes the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned that the assumptions, risks and uncertainties referenced above are not exhaustive. Forward-looking statements are made as of the date of this document and, except as required by law, the Company undertakes no obligation to update publicly or revise any forward-looking statements. The forward-looking statements contained in this document are expressly qualified by these cautionary statements.
SOURCE: Encana Corporation
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TORONTO, ONTARIO–(Marketwired – March 30, 2016) –
NOT FOR DISTRIBUTION IN THE UNITED STATES OF AMERICA
GoviEx Uranium Inc. (CSE:GXU) (“GoviEx”) and Denison Mines Corp. (TSX:DML)(NYSE MKT:DNN) (“Denison”) are pleased to announce the execution of a Definitive Share Purchase Agreement (the “Agreement”) to combine their respective African uranium mineral interests (the “Transaction”) to create the leading Africa-focused uranium development company.
Under the terms of the Transaction, GoviEx will acquire Denison’s wholly owned subsidiary, Rockgate Capital Corp., which holds all of Denison’s Africa-based uranium interests (collectively “DML Africa”), in exchange for approximately 56.1 million shares of GoviEx (the “Consideration Shares”) plus approximately 22.4 million common share purchase warrants of GoviEx (the “Consideration Warrants”). Upon completion of the Transaction, Denison will hold 25% of GoviEx shares outstanding and 28% of GoviEx shares on a fully diluted basis.
The asset portfolio of the combined company will include two permitted uranium development projects – including GoviEx’s Madaouela project in Niger and Denison’s Mutanga project in Zambia. It will also include Denison’s Falea project, an advanced exploration-stage asset project in Mali, and the exploration-stage Dome project in Namibia. Following completion of the Transaction, GoviEx will control one of the largest uranium resource bases among publicly listed companies, with combined National Instrument 43-101 (“NI 43-101″) Measured & Indicated resources of 124.29 Mlbs U3O8, plus Inferred resources of 73.11 Mlbs U3O8.
Govind Friedland, Founder and Executive Chairman of GoviEx, commented: “We welcome the opportunity to join forces with mining industry leader Lukas Lundin, and his team at Denison, to combine Africa’s leading uranium assets into one consolidated vehicle. This Transaction is a win-win as it provides GoviEx with geographical diversification and allows Denison to focus on its core assets in Canada while enhancing its upside exposure to our combined Africa assets.”
David Cates, President and Chief Executive Officer of Denison, commented: “This transaction will provide Denison shareholders with significant exposure to the Madaouela project, one of the world’s most advanced uranium development assets, while finding an excellent home for our own uranium projects in Africa. This transaction completes Denison’s transition to fully focus on becoming an Athabasca Basin uranium producer.”
Benefits to GoviEx shareholders
Benefits to Denison shareholders
Transaction details
Pursuant to the terms of the Agreement, GoviEx will acquire DML Africa from Denison in exchange for 56,050,450 Consideration Shares and 22,420,180 Consideration Warrants, being four-tenths of a Consideration Warrant for each Consideration Share to be issued. Each such Consideration Warrant will be convertible into one common share of GoviEx at a price of US$0.15 per share for a period of three (3) years. The Consideration Warrants will include an acceleration clause, which will provide that, in the event that the closing price of GoviEx’s common shares on the Canadian Securities Exchange (“CSE”) is equal to or greater than C$0.24 per share for a period of 15 consecutive trading days, GoviEx may provide holders of the Consideration Warrants with written notice that holders have 30 days within which to exercise the Consideration Warrants on the original terms, failing which the exercise price of the Consideration Warrants will be increased to US$18 per share and the term of the Consideration Warrants will be reduced by six months.
At the time of closing the Transaction, Denison will ensure that DML Africa is capitalized with a minimum working capital of US$700,000, which is equivalent to the forecasted annual budget for the assets of DML Africa.
For so long as Denison holds at least 5% of the issued and outstanding common shares of GoviEx, Denison will have the right to appoint one director to the GoviEx board of directors and will have the right to participate in future GoviEx equity financings in order to maintain its pro-rata ownership.
Concurrent financing
As part of the Transaction, GoviEx will undertake a concurrent equity financing by means of a non-brokered private placement (the “Placement”) to raise gross proceeds of not less than US$2,000,000, of which Denison will provide the lead order for 25% up to a maximum of US$500,000. The Placement is expected to be completed prior to, or concurrently with, the closing of the Transaction (“Closing”) and is a condition of Closing.
Expected closing
The Transaction is expected to close on or about May 17, 2016, subject to the receipt of required consents and approvals, as well as the satisfaction of other conditions customary for a transaction of this nature.
Raymond James Ltd. is acting as GoviEx’s financial advisor. Haywood Securities Inc. is acting as Denison’s financial advisor.
Further information on Mineral Resources
Following completion of the Transaction, GoviEx will control one of the largest undeveloped uranium resource bases among publicly listed companies, as summarized below:
Measured Mineral Resource Estimates (1)(2)
| Project/Deposit | Tonnes (Mt) |
Grade (kg/t eU3O8 or U3O8) |
Contained Metal (Mlb eU3O8 or U3O8) | ||
| Madaouela(3) – Marianne/Marilyn | 2.14 | 1.79 | 8.45 | ||
| Madaouela(3) – Miriam | 7.26 | 1.13 | 18.14 | ||
| Mutanga – Mutanga(4) | 1.88 | 0.48 | 2.00 | ||
| Total Measured | 11.28 | 1.15 | 28.59 | ||
Indicated Mineral Resource Estimates (1)(2)
| Project/Deposit | Tonnes (Mt) |
Grade (kg/t eU3O8 or U3O8) |
Contained Metal (Mlb eU3O8 or U3O8) | ||
| Madaouela(3) – Marianne/Marilyn | 14.72 | 1.43 | 46.30 | ||
| Madaouela(3) – Miriam | 1.95 | 0.80 | 3.48 | ||
| Madaouela(3) – MSNE | 5.05 | 1.61 | 17.88 | ||
| Madaouela(3) – Maryvonne | 1.23 | 1.79 | 4.84 | ||
| Mutanga – Mutanga(4) | 8.40 | 0.31 | 5.80 | ||
| Falea(5)(6) | 6.88 | 1.15 | 17.40 | ||
| Total Indicated | 38.23 | 1.14 | 95.70 | ||
Inferred Mineral Resource Estimates (1)(2)
| Project/Deposit | Tonnes (Mt) |
Grade (kg/t eU3O8or U3O8) |
Contained Metal (Mlb eU3O8 or U3O8) | ||
| Madaouela(3) – Marianne/Marilyn | 5.04 | 1.17 | 13.02 | ||
| Madaouela(3) – Miriam | 0.21 | 1.26 | 0.57 | ||
| Madaouela(3) – MSNE | 0.10 | 1.34 | 0.29 | ||
| Madaouela(3) – Maryvonne | 0.42 | 1.66 | 1.55 | ||
| Madaouela(3) – MSCE | 0.72 | 1.81 | 2.88 | ||
| Mutanga – Mutanga(4) | 7.20 | 0.21 | 3.30 | ||
| Mutanga – Dibwe(4) | 17.00 | 0.23 | 9.00 | ||
| Mutanga – Dibwe East(4) | 39.80 | 0.32 | 28.20 | ||
| Mutanga – Mutanga Ext(4) | 0.50 | 0.34 | 0.40 | ||
| Mutanga – Mutanga East(4) | 0.20 | 0.32 | 0.10 | ||
| Mutanga – Mutanga West(4) | 0.50 | 0.34 | 0.40 | ||
| Falea(5)(6) | 8.78 | 0.69 | 13.40 | ||
| Total Inferred | 80.47 | 0.41 | 73.11 | ||
| Notes: | ||
| (1) | Mineral resources are not mineral reserves and do not have demonstrated economic viability. CIM definitions were followed for classification of mineral resources. | |
| (2) | The mineral resources were estimated at various cut-off grades, as follows: | |
| i. | Madaouela: 0.4 kg/t eU | |
| ii. | Mutanga: 0.1 kg/t U3O8, Dibwe: 0.1 kg/t U3O8, Dibwe East: 0.1 kg/t U3O8, Mutanga Ext: 0.2 kg/t U3O8, Mutanga East: 0.2 kg/t U3O8, Mutanga West: 0.2 kg/t U3O8 | |
| iii. | Falea: 0.3 kg/t U3O8 | |
| (3) | Mineral resources estimated in radiometric equivalent uranium from a total gamma downhole probe (“eU3O8“). Source: An Updated Integrated Development Plan for the Madaouela Project, Niger, dated September 20, 2013 and amended and restated August 20, 2015, authored by Eur.Geol. Robert John Bowell PhD C.Chem. C.Geol, Daniel Guibal, Min Eng, FAusIMM (CP), MMICA, MGAA, Timothy John McGurk B.Eng (Hons), C.Eng, FIMMM, Neal Rigby, CEng, PhD, MIMMM, Richard Ingram Skelton MSc, BSc (Hons), C.Eng, MIMMM, MSAIMM, ARSM, John Arthur, PhD, MSc, BSc, MIMMM. The reported mineral resources have been adjusted to account for the absence of the Agaliouk license. | |
| (4) | Mineral resources estimated in U3O8. Source: Mineral Resource Estimates for the Mutanga Uranium Project (the “Combined Mutanga Report”), dated September 12, 2013, authored by Malcolm Titley, B.Sc., MAusIMM, MAIG. | |
| (5) | Source: Technical Report on the Felea Uranium, Silver and Copper Deposit, Mali, West Afica dated October 26, 2015 authored by Mark B. Mathisen, C.P.G. The results of the estimates are included in the tables above. CIM definitions were followed for classification of Mineral Resources. A copy of the report is available on Denison’s website (http://www.denisonmines.com/). | |
| (6) | The mineral resource also contains 0.161% copper (24.4 million pounds) and 72.8 g/t Ag (16.11 million ounces) in the Indicated mineral resource, and 0.2% copper (38.7 million pounds) and 17.3 g/t Ag (4.9 million ounces) in the Inferred mineral resource. | |
Further information on the material mineral resources noted above is available on SEDAR (www.sedar.com) under Denison’s and GoviEx’s respective profiles.
Qualified persons
For GoviEx, the scientific and technical information disclosed in this release has been reviewed, verified and approved by Dr. Rob Bowell, a chartered chemist of the Royal Society of Chemistry, a chartered geologist of the Geological Society of London and Fellow of the Institute of Mining, Metallurgy and Materials, who is an independent Qualified Person under the terms of National Instrument 43-101 for uranium deposits.
For Denison, the disclosure of a scientific or technical nature contained in this news release was prepared by Dale Verran, MSc, Pr.Sci.Nat., Denison’s Vice President, Exploration, who is a Qualified Person in accordance with the requirements of NI 43-101.
About GoviEx Uranium
GoviEx is a mineral resource company focused on the exploration and development of uranium properties. GoviEx’s principal objective is to become a significant uranium producer through the continued exploration and development of its Mine Permitted Madaouela Project and its other uranium properties in Niger.
About Denison
Denison is a uranium exploration and development company with interests focused in the Athabasca Basin region of northern Saskatchewan. Including its 60% owned Wheeler River project, which hosts the high grade Phoenix and Gryphon uranium deposits, Denison’s exploration portfolio consists of numerous projects covering over 390,000 hectares in the eastern Athabasca Basin. Denison’s interests in Saskatchewan also include a 22.5% ownership interest in the McClean Lake joint venture, which includes several uranium deposits and the McClean Lake uranium mill, which is currently processing ore from the Cigar Lake mine under a toll milling agreement, plus a 25.17% interest in the Midwest deposit and a 61.55% interest in the J Zone deposit on the Waterbury Lake property. Both the Midwest and J Zone deposits are located within 20 kilometres of the McClean Lake mill. Internationally, Denison owns 100% of the Mutanga project in Zambia, 100% of the uranium/copper/silver Falea project in Mali, and a 90% interest in the Dome project in Namibia.
Denison is also engaged in mine decommissioning and environmental services through its Denison Environmental Services division and is the manager of Uranium Participation Corp., a publicly traded company which invests in uranium oxide and uranium hexafluoride.
Cautionary statement regarding forward-looking statements
This press release may contain forward-looking information within the meaning of applicable securities laws. All information and statements other than statements of current or historical facts contained in this press release are forward-looking information. Forward-looking statements are subject to various risks and uncertainties concerning the specific factors disclosed here and elsewhere in both GoviEx’s and Denison’s periodic filings with Canadian securities regulators. When used in this news release, words such as “will”, “could”, “plan”, “estimate”, “expect”, “intend”, “may”, “potential”, “should,” and similar expressions, are forward-looking statements. Information provided in this document is necessarily summarized and may not contain all available material information.
Forward-looking statements include, without limitation, statements regarding completion and expected benefits of the Transaction and other statements that are not facts. Forward-looking statements are based on a number of assumptions and estimates that, while considered reasonable by management based on the business and markets in which GoviEx and Denison operate, are inherently subject to significant operational, economic and competitive uncertainties and contingencies.
Assumptions upon which forward looking statements relating to the transaction have been made include that GoviEx and Denison will be able to satisfy the conditions in the Agreement; that all required third party, regulatory, stock exchange, and government approvals will be obtained; and that the Transaction will be successfully concluded. In addition, the factors described or referred to in the section entitled “Risk Factors” in the MD&A of both companies and which are available on the SEDAR website at www.sedar.com, should be reviewed in conjunction with the information found in this news release.
Although GoviEx and Denison have attempted to identify important factors that could cause actual results, performance or achievements to differ materially from those contained in the forward-looking statements, there can be other factors that cause results, performance or achievements not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate or that management’s expectations or estimates of future developments, circumstances or results will materialize. As a result of these risks and uncertainties, the Transaction could be modified, restricted or not completed, and the results or events predicted in these forward looking statements may differ materially from actual results or events. Accordingly, readers should not place undue reliance on forward-looking statements. The forward-looking statements in this news release are made as of the date of this news release, and GoviEx and Denison disclaim any intention or obligation to update or revise such information, except as required by applicable law, and neither GoviEx nor Denison assume any liability for disclosure relating to the other company herein.
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The Richmond Club recent released an Investor Presentation highlighting Torchlight Energy Resources (NASDAQ:TRCH). Torchlight Energy Resources, based in Plano, Texas, is a high growth oil and gas Exploration and Production (E&P) company with a primary focus on acquisition and development of highly profitable domestic oil fields. The company currently holds interests in Texas, Oklahoma and Kansas where their targets are established plays such as the Eagle Ford, Hunton, Mississippian and Maquoketa Dolomite / Viola formations.
Watch the full video presentation
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The lithium world saw a bit of a shakeup this Easter Monday when Chile’s Sociedad Química y Minera de Chile (NYSE:SQM) announced it would be entering a joint venture with Lithium Americas (TSX:WLC).
Under the terms of the agreement, SQM will pay US$25 million for a 50 percent stake in Lithium Americas’s Cauchari-Olaroz lithium project in Jujuy, Argentina. The payment will go to Minera Exar, a wholly owned subsidiary of Lithium Americas that is currently developing the project.
US$15 million will go towards repaying intercompany loans between Minera Exar and Lithium Americas, while the remaining US$10 million will go towards development of the project. SQM and Lithium Americas are looking at completing an updated feasibility study for the project, which would contemplate a nameplate production capacity of 40,000 tons per year of lithium carbonate.
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“SQM is the world leader in lithium production with decades of development and operating experience and a strong team of technical and commercial talent,” said Lithium Americas CEO Tom Hodgson in a statement. “It also has a track record of success as a partner in many global joint ventures.”
Certainly, securing a partnership with one of the world’s biggest lithium producers looks to be another big vote of confidence for Lithium Americas and Cauchari-Olaroz. However, analysts in the space were also interested in what the move means for SQM, with Joe Lowry of Global Lithium referring to a ‘lithium comeback’ for the company:
$SQM moving into Argentina for #lithium expansion. Validates our Great Game thesis. @LithiumAmericas
— Chris Berry (@cberry1) March 28, 2016
$SQM announces JV with $LAC. Now things get interesting. $ALB $FMC $GXY $PLS #lithium
— Joe Lowry (@globallithium) March 28, 2016
$SQM #lithium “comeback” begins. On the heels of their $LAC announcement, they head to China. #downbutnotoutforsure pic.twitter.com/kX3pXokOfi
— Joe Lowry (@globallithium) March 29, 2016
SQM, which is also a significant producer of potash and iodine, came under scrutiny last year as part of a probe into bribery and tax evasion by the Chilean government. It also butted heads with Chile’s Corfo over its leases in the Atacama.
The company has traditionally focused on lithium in Chile, and as Industrial Minerals (subscription) notes, this move marks SQMs first investment in lithium production outside of the country. However, SQM CEO Patricio de Solminihac stressed that the company is still focused on its operations in Chile.
“SQM is committed to the lithium business, both in Chile and abroad,” he said in Monday’s release. “The Salar de Caucharí is a great complement to our existing lithium operations in Chile, and it is located just a few hundred kilometers from the Salar de Atacama. We expect to have similar production processes at both sites, and as a result we should benefit from operating synergies.”
Franco Mignacco, President of Minera Exar, pointed to the agreement as an example of “success for all stakeholders and local communities from the policies of the new Argentine government in its desire to attract foreign investment.” Mauricio Macri was elected as president of Argentina late last year, bringing a political shift in the country that’s being seen as a win for the mining industry and for investment in the Argentina in general.
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Lithium Americas, which recently changed its name from Western Lithium, was formed through the combination of two junior lithium companies last year. That merger put Western Lithium’s Kings Valley project in Nevada and Lithium Americas’ Cauchari-Olaroz project in Argentina under one umbrella.
Cauchari-Olaroz garnered plenty of attention earlier last year as market watchers focused on a budding relationship with Korean Steelmaker POSCO. Lithium Americas announced last May that it was in talks regarding the use of POSCO’s proprietary lithium extraction process in the development of Cauchari-Olaroz.
Shares of Lithium Americas were down 3.16 percent to $0.46 in Toronto on Tuesday, while shares of SQM were up roughly one percent.
Securities Disclosure: I, Teresa Matich, hold no direct investment interest in any company mentioned in this article.
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Bloomberg reported that according to Barclays plc (LSE:BARC), commodities like oil and copper may decline steeply due to “recent advances that aren’t fully grounded in improved fundamentals.” The firm predicts that investors may make a rush out of these commodities.
As quoted in the market news:
Copper may slump to the low $4 000s a metric ton, from $4 945 in London last week, while oil could fall back to the low $30s a barrel, analyst Kevin Norrish said in a note. The risk for raw materials is that investors seek to liquidate bets on gains quickly and in unison, with potentially highly negative consequences, Norrish wrote in the note entitled “Buffalo Jump,” a term that describes a cliff where Native Americans herded bison to their death.
“Investors have been attracted to commodities as one of the best performing assets so far in 2016,” he said in the March 28 report. “However, in the absence of any concerted fundamental improvements, those returns are unlikely to be repeated in the second quarter, making commodities vulnerable to a wave of investor liquidation.”
Click here to read the full Bloomberg report.
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Updated December 2015
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The Richmond Club recent released an Investor Presentation highlighting TriMetals Mining Inc (TSXV:TMI). TriMetals Mining is focused on the exploration and resource expansion at the near surface, Gold Springs gold-silver project in mining friendly Nevada and Utah in the U.S.A.
Watch the full video presentation
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TORONTO, ON–(Marketwired – March 29, 2016) – Scotiabank’s Commodity Price Index edged down in February by -0.3% m/m (-25.0% yr/yr) — the fourth consecutive monthly decline — but is expected to rally significantly in March. Commodity prices have rebounded across a broad front since mid-February amid some easing in concern over the outlook for China’s economy and a weaker U.S. dollar.
“Equally important, hedge & investment funds appear to be looking for reasons to bid commodity prices higher, after the rout of recent years. The Scotiabank Commodity Price Index is currently at a more than a decade low,” said Patricia Mohr, Vice President of Economics and Commodity Market Specialist at Scotiabank. “2016 should be a transition year for commodity prices, with the current slowdown in global capital spending in oil & gas and mining setting the stage for a strong rebound going into the next decade.”
The Oil & Gas Index once more led commodity prices lower in February (-7.4% m/m,-49.7% yr/yr). A decline in ‘Western Canadian Select (WCS) heavy’ and ‘light, sweet’ oil prices at Edmonton as well as exceptionally low Canadian natural gas export prices (US$2.08 per mmbtu) more than offset stronger propane prices at Edmonton & Sarnia. However, prices will rebound significantly in March.
Other highlights from the report include:
Read the full Scotiabank Commodity Price Index online at: http://www.scotiabank.com/ca/en/0,,3112,00.html.
Scotiabank provides clients with in-depth research into the factors shaping the outlook for Canada and the global economy, including macroeconomic developments, currency and capital market trends, commodity and industry performance, as well as monetary, fiscal and public policy issues.
About Scotiabank
Scotiabank is Canada’s international bank and a leading financial services provider in North America, Latin America, the Caribbean and Central America, and Asia-Pacific. We are dedicated to helping our 23 million customers become better off through a broad range of advice, products and services, including personal and commercial banking, wealth management and private banking, corporate and investment banking, and capital markets. With a team of more than 89,000 employees and assets of $920 billion (as at January 31, 2016), Scotiabank trades on the Toronto (TSX: BNS) and New York Exchanges (NYSE: BNS). Scotiabank distributes the Bank’s media releases using Marketwired. For more information, please visit www.scotiabank.com and follow us on Twitter @ScotiabankNews.
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Leading Global Intelligence and Advisory Firm Says Europe’s Migrant Crisis, Turkey’s Internal Struggles and Russian Efforts to Negotiate on Sanctions All Tie Back to Syria in Second Quarter of 2016
AUSTIN, TX–(Marketwired – March 29, 2016) – Crisis and conflict surrounding Syria will drive broader global developments in the months ahead, according to Stratfor, which just released its Second Quarter Forecast for 2016. The geopolitical intelligence and advisory firm says the protracted war in Syria remains the key to Europe’s migrant crisis as well as a major complication in Turkey’s internal struggles, and that Russia remains at the center of the conflict.
Russia, which recently ordered a drawdown of its forces form Syria, is looking ahead to July — when European leaders vote on Russian sanctions, and NATO members discuss an expanded security footprint along Russia’s western flank. Stratfor analysts note that what Moscow fails to achieve by bringing some of its troops home from Syria will prove far more interesting than what it actually will achieve as it tries to shape negotiations elsewhere.
“If anyone can turn a source of conflict into a source of leverage, it is Russia,” says Stratfor Vice President of Global Analysis Reva Goujon. “Over the past quarter, Moscow demonstrated that it has the influence to both escalate and tamp down the level of violence in Syria, much like it can in eastern Ukraine.”
Other key global developments Stratfor predicts for the second quarter of 2016 include:
Stratfor‘s complete Second Quarter Forecast for 2016 — along with its Annual Forecast for the year — is now available at Stratfor.com. Past Stratfor forecasts have anticipated years in advance the Turkish resurgence, the U.S. rapprochement with Iran, the Chinese economic slowdown, Russia’s resurgence in the former Soviet periphery and the political fragmentation in Europe.
About Stratfor
Stratfor is a geopolitical intelligence firm that provides strategic analysis and forecasting to individuals and organizations around the world. By placing global events in a geopolitical framework, we give readers a strategic advantage as they work to anticipate opportunities and better understand international developments.
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Embedded Video Available: https://youtu.be/3avtbzlN3wU
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CALGARY, ALBERTA–(Marketwired – March 29, 2016) – Anderson Energy Inc. (“Anderson” or the “Company”) (TSX:AXL) announces its operating and financial results for the fourth quarter and year ended December 31, 2015. The Company will be filing its audited financial statements and management’s discussion and analysis (“MD&A”) for the years ended December 31, 2015 and 2014 on SEDAR today. Copies can be found under the Company’s profile on www.sedar.com and on the Company’s website at www.andersonenergy.ca.
HIGHLIGHTS
FINANCIAL AND OPERATING HIGHLIGHTS
| Three months ended December 31 | Year ended December 31 | ||||||||||||||||
| (thousands of dollars, unless otherwise stated) | 2015 | 2014 | % Change |
2015 | 2014 | % Change |
|||||||||||
| Oil and gas sales (1) | $ | 4,971 | $ | 11,337 | (56% | ) | $ | 25,070 | $ | 50,659 | (51% | ) | |||||
| Revenue, net of royalties (1) | $ | 4,915 | $ | 10,513 | (53% | ) | $ | 23,339 | $ | 46,396 | (50% | ) | |||||
| Funds from operations | $ | 14 | $ | 5,884 | (100% | ) | $ | 2,577 | $ | 19,195 | (87% | ) | |||||
| Funds from operations | |||||||||||||||||
| per share – basic and diluted | $ | – | $ | 0.03 | (100% | ) | $ | 0.01 | $ | 0.11 | (91% | ) | |||||
| Adjusted earnings (loss) before taxes (2) | $ | (4,037 | ) | $ | (4,136 | ) | 2% | $ | 13,957 | $ | (7,538 | ) | 285% | ||||
| Adjusted earnings (loss) before taxes | |||||||||||||||||
| per share(2) – basic and diluted | $ | (0.02 | ) | $ | (0.02 | ) | – | $ | 0.08 | $ | (0.04 | ) | 300% | ||||
| Earnings (loss) | $ | (3,477 | ) | $ | (53,118 | ) | 93% | $ | (17,924 | ) | $ | (56,520 | ) | 68% | |||
| Earnings (loss) per share | |||||||||||||||||
| Basic and diluted | $ | (0.02 | ) | $ | (0.31 | ) | 94% | $ | (0.10 | ) | $ | (0.33 | ) | 70% | |||
| Capital expenditures (net of proceeds on dispositions) | $ | 310 | $ | 22,878 | (99% | ) | $ | (30,582 | ) | $ | 52,087 | (159% | ) | ||||
| Bank loans and adjusted working capital (deficiency) | $ | 6,745 | $ | (24,794 | ) | 127% | |||||||||||
| Convertible debentures | $ | 93,991 | $ | 91,326 | 3% | ||||||||||||
| Shareholders’ equity | $ | (45,312 | ) | $ | (27,806 | ) | (63% | ) | |||||||||
| Average shares outstanding (thousands): | |||||||||||||||||
| Basic and diluted | 172,550 | 172,550 | – | 172,550 | 172,550 | – | |||||||||||
| Ending shares outstanding (thousands) | 172,550 | 172,550 | – | ||||||||||||||
| Average daily sales: | |||||||||||||||||
| Oil and condensate (bpd) | 714 | 945 | (24% | ) | 880 | 841 | 5% | ||||||||||
| NGL (bpd) | 182 | 252 | (28% | ) | 157 | 184 | (15% | ) | |||||||||
| Natural gas (Mcfd) | 6,844 | 13,188 | (48% | ) | 7,511 | 12,692 | (41% | ) | |||||||||
| Barrels of oil equivalent (BOED) (3) | 2,037 | 3,396 | (40% | ) | 2,290 | 3,141 | (27% | ) | |||||||||
| Average prices: | |||||||||||||||||
| Oil and condensate ($/bbl) | $ | 49.78 | $ | 68.94 | (28% | ) | $ | 54.20 | $ | 90.73 | (40% | ) | |||||
| NGL ($/bbl) | $ | 11.56 | $ | 26.92 | (57% | ) | $ | 9.76 | $ | 38.22 | (74% | ) | |||||
| Natural gas ($/Mcf) | $ | 2.40 | $ | 3.75 | (36% | ) | $ | 2.58 | $ | 4.30 | (40% | ) | |||||
| Barrels of oil equivalent ($/BOE) (3) | $ | 26.53 | $ | 36.29 | (27% | ) | $ | 30.00 | $ | 44.19 | (32% | ) | |||||
| Realized gain on derivative contracts ($/BOE) | $ | – | $ | 4.10 | (100% | ) | $ | – | $ | 0.64 | (100% | ) | |||||
| Royalties ($/BOE) | $ | 0.29 | $ | 2.64 | (89% | ) | $ | 2.07 | $ | 3.72 | (44% | ) | |||||
| Operating costs ($/BOE) | $ | 10.87 | $ | 10.03 | 8% | $ | 10.10 | $ | 12.43 | (19% | ) | ||||||
| Transportation costs ($/BOE) | $ | 0.21 | $ | 0.19 | 11% | $ | 0.25 | $ | 0.27 | (7% | ) | ||||||
| Operating netback ($/BOE) (2) | $ | 15.16 | $ | 27.53 | (45% | ) | $ | 17.58 | $ | 28.41 | (38% | ) | |||||
| Reserves (MBOE): (3) | |||||||||||||||||
| Total proved | 3,712 | 5,279 | (30% | ) | |||||||||||||
| Proved plus probable | 6,517 | 9,210 | (29% | ) | |||||||||||||
| Wells drilled (gross) | – | 6 | (100% | ) | 2 | 13 | (85% | ) | |||||||||
| (1)Includes royalty and other income classified with oil and gas sales, but excludes realized and unrealized gains or losses on derivative contracts. |
| (2)Adjusted earnings (loss) before taxes, adjusted earnings (loss) before taxes per share and operating netback per BOE are considered non-GAAP measures. Refer to the section entitled “Non-GAAP Measures” in the MD&A for a more complete description of these non-GAAP terms, reconciliations to the closest related GAAP measures, and the purposes for which management uses the non-GAAP measures. These non-GAAP measures may not be comparable with the calculation of similar measures for other entities. |
| (3)Barrels of oil equivalent (“BOE”) may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 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. |
COMMODITY PRICE COLLAPSE
Tremendous swings in both oil and natural gas prices continued in 2015. The average WTI oil price per bbl was approximately $48.76 US in 2015, compared to $92.92 US in 2014. Monthly average WTI oil prices ranged from a high of $59.83 US per bbl in June 2015 to a low of $37.33 US per bbl in December 2015. Oil prices continued to decrease in the first quarter of 2016 due to oversupply and inadequate demand to consume the oversupply. The lowest average monthly price seen to date in 2016 was $30.62 US per bbl, realized in February 2016. Although the US/Canadian dollar exchange rate has moved beneficially from an average of approximately $0.78 in 2015 to approximately $0.73 year to date in 2016, it has not sufficiently compensated for the collapse in WTI pricing. Recent average NYMEX futures pricing for WTI for April through December 2016 is approximately $42.26 US per bbl ($55.95 Canadian per bbl).
Natural gas prices have continued to decrease since the fourth quarter of 2015 and AECO pricing in March 2016 is the lowest it has been since September 1997. US and Canadian natural gas storage levels are historically high for this time of year, therefore natural gas prices will likely be depressed until the onset of winter next year.
In response to the decline in oil prices, the Company stopped its drilling program on January 28, 2015. The Company focused its efforts on reducing operating, administrative and capital costs, in both the office and in the field in order to be positioned to resume drilling when commodity prices improve.
COST SAVING MEASURES
1) General and administrative (“G&A”) expenses: In 2015, the Company’s gross G&A (cash) expenses were $6.6 million. Changes were made to the G&A cost structure in the first quarter of 2015 which contributed to the reduction in gross G&A (cash) expenses of $1.7 million from the 2014 gross G&A (cash) expenses of $8.3 million. Most of the reductions were in the last three quarters of 2015. These changes included the cancellation of bonuses for management, the reduction in bonuses for staff, the reduction in salaries and benefits for both management and staff and the renegotiation of contracts for other services. Approximately 15% of the Company’s gross G&A (cash) expenses is capitalized and the balance is expensed. Overhead recoveries were slightly lower than in 2014. The Company had approximately $0.4 million in gross non-cash stock based compensation costs in 2015. During the first quarter of 2016, further reductions were made to staff counts, compensation and other administrative costs which are expected to decrease gross G&A (cash) expenses by $1.0 million in 2016. The reduction in compensation expense in 2016 will be partially offset by one-time severance costs.
2) Operating expenses: With the reduction in commodity prices, the Company has been focusing on reducing field operating expenses. In 2015, shutting in uneconomic shallow gas operations resulted in significant reductions in both manpower and maintenance costs. In addition, capital investments were made to eliminate rental equipment costs associated with field operations. Current initiatives are focused on further optimization of manpower costs, as well as the reconfiguration of existing oil batteries to enable clean oil trucking and significantly reduce emulsion handling costs. The Company’s overall operating expenses in 2015 averaged $10.10 per BOE compared to $12.43 per BOE in 2014. The operating expenses budgeted for 2016 are $11.00 per BOE, assuming the Company does not drill any Cardium horizontal wells in 2016. If new Cardium horizontal wells are drilled and brought on production in the second half of 2016, they could reduce annual operating expenses per BOE.
3) Capital expenditures: In previous commodity price downturns, the industry has been able to find significant reductions in per unit capital costs to improve the economic equation. Anderson has been working with suppliers and service providers for improved cost efficiency and operations, and believes up to a 30% reduction in capital costs may be achievable. The Company historically has been a leader in low cost Cardium horizontal drilling and completions and is working towards achieving even lower costs.
TCPL OUTAGES
On December 15, 2014, TCPL issued a notice to all shippers upstream of James River, Alberta regarding the restriction of natural gas volume receipts to certain limits. As a result of the actions taken by TCPL, disruptions to pipeline transportation service in the affected areas (referred to as “outages”) resulted in restrictions on the Company’s production in various areas, including its Willesden Green Cardium area. The restrictions affected the production of oil, condensate and NGL as well as natural gas. The Company estimates that the impact of the TCPL outages averaged approximately 165 BOED in 2015. The outages affecting the Company’s production were essentially over by the end of November 2015.
Anderson’s Willesden Green Cardium area now falls outside of the current TCPL restricted area. However, due to the fluctuating nature of the outages and the changing forecasts provided by TCPL, it is difficult to estimate the extent of the impact of potential outages on the Company’s future results.
2014/2015 WINTER DRILLING PROGRAM
The Company completed its 2014/2015 winter drilling program in January 2015 with 9 gross (8.1 net capital, 7.0 net revenue) new Cardium oil wells. Due to weak commodity prices, the drilling of the remaining 3 gross (2.2 net) Cardium wells in the planned program was deferred. The average production results exceeded the Company’s expectations with an average IP 30 of 413 BOED (85% oil, condensate and NGL). The best well in the drilling program had an IP 30 of 707 BOED (71% oil, condensate and NGL). Included in this drilling program was the Company’s first long-reach well which had an IP 30 of 651 BOED (92% oil, condensate and NGL) with 32 frac stages over a 1.5 mile horizontal well section.
Of the nine Cardium wells drilled in the 2014/2015 winter drilling program, five are in the central land block, three are in the northern land block and one is in the southern land block of the greater Willesden Green area.
The IP 30 and product mix results from the Cardium wells from the 2014/2015 winter drilling program compares favourably with the 2013/2014 winter drilling program which had an average IP 30 of 511 BOED (53% oil, condensate and NGL). A comparison of the oil, condensate and NGL components of the BOED production for the two drilling programs shows an average IP 30 of 349 bpd for the 2014/2015 winter drilling program and 272 bpd for the 2013/2014 winter drilling program. Notwithstanding the market perception of the current oil price environment, oil, condensate and NGL remain more valuable than solution gas, and a higher percentage of oil, condensate and NGL in the Company’s product mix can be more important to overall revenue and profitability than the overall BOED production rate.
The average IP 30 for the 19 Cardium wells completed with slick water fracture stimulation in the Willesden Green area on Company lands since June 2012 was 469 BOED (68% oil, condensate and NGL). The best single well IP 30 result from these wells was 1,119 BOED (67% oil, condensate and NGL).
By using selective positioning of the horizontal well trajectory, Anderson is realizing higher IP 30 production rates than historical Willesden Green area industry averages. The Company has now adopted the use of dissolvable frac balls for toe fracs and has moved to less nitrogen usage in heel fracs. Other changes made this year include a redesigned stage tool to reduce the risk of mechanical wellbore failure.
LIGHT OIL HORIZONTAL POTENTIAL DRILLING OPPORTUNITIES
The Company’s undeveloped light oil horizontal potential drilling opportunities at March 28, 2016, are outlined below:
| Prospect Area (number of potential drilling opportunities) | Gross | Net* |
| Willesden Green Cardium | 74 | 55.0 |
| West Pembina/Buck Lake Cardium | 18 | 7.5 |
| Willesden Green Glauconite | 6 | 6.0 |
| Total Light Oil Horizontal Potential Drilling Opportunities, March 28, 2016 | 98 | 68.5 |
| * Net is net revenue interest. |
GLJ Petroleum Consultants (“GLJ”), the Company’s independent reserves evaluator, booked undeveloped reserves to 17.9 of these net potential drilling opportunities at December 31, 2015.
The number of potential drilling opportunities is slightly lower than in 2015 due to the disposition of some lower working interest lands and economic factors.
The Duvernay Carbonate light oil horizontal project lands acquired in the first quarter of 2016 could yield an incremental four potential horizontal drilling opportunities per section. The Company acquired over 12 sections of 100% working interest lands.
2016 PRODUCTION AND CAPITAL PROGRAM
The Company estimates production will be approximately 1,500 to 1,600 BOED (42% oil, condensate and NGL) for 2016. Production in the first quarter of 2016 is estimated to be 1,750 to 1,850 BOED (42% oil, condensate and NGL). This estimate assumes no drilling is undertaken in 2016 and reflects the recent shut-in of approximately 43 BOED of uneconomic gas production. The Company’s capital budget of $3 million is restricted to maintenance capital, capitalized G&A and land acquisition (net of dispositions). The price trigger to consider starting up a new drilling program is estimated to be approximately $50 WTI US per bbl. Where possible, Anderson tries to achieve a 12 month or less payout on new drilling projects and the combination of capital costs, operating costs, fiscal regime and commodity prices are the variables that need to be determined prior to undertaking a capital program. As well, the Company will complete its May 2016 bank line review before undertaking a drilling program. The details of the royalty review need to be completed by the Alberta government and evaluated by the Company, as it could impact whether the Company drills in 2016 or waits until 2017.
WELL COUNT
| December 31, 2015 | December 31, 2014 | ||||
| Gross | Net | Gross | Net | ||
| Producing wells | |||||
| Oil | 63 | 41.3 | 75 | 46.1 | |
| Gas | 89 | 51.2 | 268 | 156.1 | |
| 152 | 92.5 | 343 | 202.2 | ||
| Non-producing wells | 254 | 177.5 | 297 | 189.2 | |
| Total active wells | 406 | 270.0 | 640 | 391.4 | |
In 2015, significant progress was made in focusing the Company’s asset base into the core Cardium operating areas and divesting or shutting in production outside of these focus areas. 199 wellbores were sold and 48 wellbores were abandoned in 2015 resulting in a 37% reduction in the gross active well count (31% reduction in net active well count). In addition, reclamation certificate applications were submitted to the AER for 28 gross (23.7 net) abandoned wells and one reclamation certificate was received. It is expected that reclamation certificate applications will be submitted for a similar number of wells in 2016.
These initiatives are continuing into 2016 with 63 gross (48.4 net) well abandonments planned, of which 16 gross (8.7 net) wells have already been abandoned to date in 2016. With this work underway, the Company is actively reducing its long-term decommissioning obligations. The Company is projecting the non-producing well count at year end 2015 will be further reduced by 25% on a gross basis and 27% on a net basis as a result of the planned 2016 well abandonment program.
Anderson has successfully completed the transition away from its shallow gas legacy and in the fourth quarter of 2015, the remaining 56 gross (34.6 net) producing shallow gas wells contributed approximately 800 Mcfd or 6.5% of the Company’s fourth quarter production.
Corporate production is now derived primarily from the Cardium formation in the Willesden Green operating area which represents 85% of the production in the fourth quarter of 2015. Of the remainder, 8.5% is from various deeper producing formations in the general Sylvan Lake area.
This rebalancing of the portfolio has allowed the Company to more effectively focus its resources on the core operating areas resulting in significant reductions in operating expenses, reduced staff count, and the implementation of a wellbore and facilities decommissioning program which takes advantage of the current low-cost structure from service providers.
COMMODITY PRICES
A comparison of Anderson’s average oil and condensate price to various market prices is presented below. Average prices are before the impact of any financial derivative contracts used for risk management. The difference between Anderson’s realized price and WTI Canadian is due to the price differential between Cushing, Oklahoma and Edmonton, Alberta, product transportation costs from the field to Edmonton, and adjustments for product quality. There were no financial derivative or fixed price contracts in 2015.
CRUDE OIL AND CONDENSATE PRICES
| Three months ended December 31 |
Year ended December 31 |
|||||||
| 2015 | 2014 | 2015 | 2014 | |||||
| WTI – $US | $ | 42.17 | $ | 73.12 | $ | 48.76 | $ | 92.92 |
| WTI – $Cdn | $ | 56.22 | $ | 82.90 | $ | 62.11 | $ | 102.40 |
| Differential from Cushing to Edmonton – $US per bbl | $ | 2.46 | $ | 6.37 | $ | 3.86 | $ | 7.19 |
| Edmonton Par – $Cdn per bbl | $ | 52.94 | $ | 75.51 | $ | 57.16 | $ | 94.50 |
| Anderson average oil price per bbl | $ | 51.68 | $ | 68.74 | $ | 54.92 | $ | 90.22 |
| Anderson average oil and condensate price per bbl* | $ | 49.78 | $ | 68.94 | $ | 54.20 | $ | 90.73 |
| *Condensate includes field condensate and plant condensate. |
The 2016 monthly WTI Canadian oil prices were approximately $45.20 per bbl in January, $42.24 per bbl in February and $52.45 per bbl in March. Differentials from Cushing, Oklahoma to Edmonton, Alberta were approximately $3.58 US per bbl in January, $4.08 US per bbl in February and $3.41 US per bbl in March 2016.
Going forward, light oil prices are expected to remain weak in the short term. Over the long term, prices will continue to be volatile and will be influenced by the balance between supply and demand, and by geopolitical events. Differentials between Cushing, Oklahoma and Edmonton, Alberta and the US/Canadian dollar exchange rate will also remain volatile.
A comparison of Anderson’s average plant gate natural gas price to various market prices is presented below. Average plant gate prices are before the impact of any financial derivative or fixed price contracts used for risk management. The difference between the AECO price and Anderson’s plant gate price is due to transportation costs and the heat content of the gas. There were no financial derivative or fixed-price contracts during 2015.
The average heat content of the Company’s natural gas has increased from 1,070 Btu/scf in the fourth quarter of 2014 to 1,121 Btu/scf in the fourth quarter of 2015 due to the new Cardium gas having higher heat content than the Company’s legacy shallow gas production. Natural gas is sold on the basis of heat content; therefore, higher heat content gas will yield higher prices per unit of measured volume.
NATURAL GAS PRICES
| Three months ended December 31 |
Year ended December 31 |
|||||||
| 2015 | 2014 | 2015 | 2014 | |||||
| NYMEX $US per MMBtu | $ | 2.24 | $ | 3.84 | $ | 2.63 | $ | 4.27 |
| AECO $CAD per GJ | $ | 2.33 | $ | 3.41 | $ | 2.55 | $ | 4.25 |
| AECO $CAD per MMBtu | $ | 2.46 | $ | 3.60 | $ | 2.69 | $ | 4.48 |
| Anderson average plant gate price per Mcf | $ | 2.40 | $ | 3.69 | $ | 2.58 | $ | 4.40 |
In 2016, AECO natural gas prices were approximately $2.25 per GJ ($2.37 per MMBtu) in January, $1.69 per GJ ($1.78 per MMBtu) in February and $1.31 per GJ ($1.38 per MMBtu) in March.
Natural gas prices are influenced by weather events and are tempered by the increasing supply of new shale gas. Until meaningful exports of natural gas commence from North America through liquefied natural gas projects, the Company believes that natural gas prices will be range-bound by weather events. Currently, Alberta natural gas prices are very weak due to a warm Alberta winter and continued growth in Western Canadian gas supply, as operators ramped up their drilling activity in anticipation of future LNG exports from British Columbia. However, North American natural gas storage can be no more than full heading into next winter, prompting the possibility of industry production shut-ins this summer and fall. The onset and severity of the North American winter will dictate the prices of natural gas next winter.
FINANCIAL RESULTS
Oil and gas sales in the fourth quarter of 2015 were lower than the third quarter of 2015 due to continued decreases in commodity prices.
On a BOE basis, oil and gas sales averaged $26.53 per BOE in the fourth quarter of 2015 compared to $30.18 per BOE in the third quarter of 2015 and $36.29 per BOE in the fourth quarter of 2014. During the fourth quarter of 2015, liquids revenue (oil, condensate and NGL) represented 70% of total oil and gas sales. The Company’s operating netback was $15.16 per BOE in the fourth quarter of 2015 compared to $18.92 per BOE in the third quarter of 2015 and $27.53 per BOE in the fourth quarter of 2014. There were no commodity hedging contracts in 2015. Realized hedging gains of $4.10 per BOE were realized in the fourth quarter of 2014. Lower operating costs per BOE reflect cost saving measures implemented in 2015. Anderson’s operating netback for Cardium properties in the fourth quarter of 2015 was $21.18 per BOE, compared to $22.14 per BOE in the third quarter of 2015, and $32.79 per BOE in the fourth quarter of 2014, exclusive of hedging in 2014.
Funds from operations for the year ended December 31, 2015 were $2.6 million compared to $19.2 million in 2014. For the fourth quarter of 2015, funds from operations were less than $0.1 million compared to $5.9 million in the fourth quarter of 2014. At low commodity prices, interest on convertible debentures had a significant impact on funds from operations. It is expected that the convertible debentures will be settled in 2016 and there will be no cash interest paid on the debentures in 2016. Funds from operations before interest on convertible debentures were $9.7 million for the year ended December 31, 2015 and $1.8 million for the fourth quarter of 2015. In addition, accrued and unpaid interest of $1.6 million at December 31, 2015 was subsequently paid in common shares and not cash. Funds from operations in 2016 will include interest on convertible debentures until their maturity, redemption or other settlement and all of this remaining interest is expected to be paid in common shares.
The Company reported a loss of $3.5 million in the fourth quarter of 2015.
OIL AND GAS NETBACKS
| Average natural gas price ($/Mcf) |
Average oil and condensate price ($/bbl) |
Revenue ($/BOE) |
Operating netback ($/BOE) |
Cash interest expense ($/BOE) |
Funds from operations ($/BOE) |
|
| Q1 2015 | 2.65 | 47.90 | 28.72 | 14.98 | 7.57 | 1.13 |
| Q2 2015 | 2.51 | 65.00 | 34.48 | 21.54 | 8.88 | 7.08 |
| Q3 2015 | 2.73 | 54.56 | 30.18 | 18.92 | 9.11 | 4.17 |
| Q4 2015 | 2.40 | 49.78 | 26.53 | 15.16 | 9.70 | 0.08 |
Capital expenditures, before dispositions of $38.2 million, were $7.7 million for the year ended December 31, 2015. Capital expenditures were $0.3 million in the fourth quarter of 2015 compared to $0.6 million in the third quarter of 2015. Capital investments in the last three quarters of 2015 were focused on maintenance activities and operating expense reduction initiatives.
COMMODITY HEDGING CONTRACTS
The Company has not hedged any crude oil or natural gas volumes at this time.
The Company continues to evaluate the merits of commodity hedging as part of a price management strategy and to provide a floor for funds from operations.
RESERVES
GLJ has completed a reserves report (the “GLJ Report”) of all the Company’s oil and natural gas properties effective December 31, 2015, prepared in accordance with procedures and standards contained in National Instrument 51-101 (“NI 51-101″) and the Canadian Oil and Gas Evaluation Handbook (“COGE Handbook”). The reserves definitions used in preparing the report are those contained in the COGE Handbook and NI 51-101. At December 31, 2015, the Company had 2,545 MBOE proved developed producing (“PDP”) reserves (46% oil and NGL(1)), 3,712 MBOE TP reserves (51% oil and NGL) and 6,517 MBOE P&P reserves (52% oil and NGL). The reserve life indices at December 31, 2015, using fourth quarter of 2015 annualized production, were 5.0 years for TP reserves and 8.8 years for P&P reserves. The GLJ price forecast used in the evaluation is shown in the MD&A for the year ended December 31, 2015.
The Cardium formation represents approximately 83%, 88% and 88% respectively of PDP, TP and P&P total BOE reserves volumes and 99%, 99% and 97% respectively of the total Company PDP, TP and P&P net present value using a 10% discount rate (“NPV 10″). The Cardium reserve life indices, using fourth quarter of 2015 annualized Cardium production, were 5.2 years for TP reserves and 9.2 years for P&P reserves.
(1)NGL in the GLJ reserves report includes condensate and other NGL.
SUMMARY OF OIL AND GAS RESERVES
| December 31, 2015 | December 31, 2014 | |||||||||
| Gross Working Interest Oil and Gas Reserves |
Oil (Mbbls) |
NGL(1) (Mbbls) |
Gas (MMcf) |
Total (MBOE) |
After tax NPV 10 ($M)(2) |
Oil (Mbbls) |
NGL(1) (Mbbls) |
Gas (MMcf) |
Total (MBOE) |
After tax NPV 10 ($M)(2) |
| Proved developed producing | 919 | 262 | 8,181 | 2,545 | 34,404 | 1,093 | 315 | 13,772 | 3,704 | 51,637 |
| Proved developed non-producing | 23 | 3 | 167 | 54 | 476 | 25 | 17 | 2,881 | 522 | 2,535 |
| Total proved | 1,529 | 356 | 10,963 | 3,712 | 41,548 | 1,716 | 414 | 18,896 | 5,279 | 60,644 |
| Proved plus probable | 2,779 | 604 | 18,804 | 6,517 | 64,984 | 3,257 | 755 | 31,187 | 9,210 | 96,138 |
| (1) NGL in the GLJ reserves report includes condensate and other NGL. |
| (2) The estimated net present value of future net revenues presented in the table above does not necessarily represent the fair market value of the Company’s reserves. |
The after tax P&P NPV 10 value of reserves was 32% lower than last year. P&P reserves volumes decreased by 29% largely due to property dispositions, production and reductions in price forecasts (economic factors), which reduced both volumes and values. The average GLJ price forecast for 2016 to 2020 was 26% lower for Edmonton Par oil prices (30% in 2016) and 21% lower for AECO natural gas prices (27% in 2016) when the December 31, 2015 price forecast was compared to the December 31, 2014 price forecast.
CONTINUITY OF GROSS WORKING INTEREST RESERVES
| Proved Developed Producing (MBOE) |
Total Proved (MBOE) |
Proved Plus Probable (MBOE) |
||||
| Opening balance, December 31, 2014 | 3,704 | 5,279 | 9,210 | |||
| Extensions and improved recovery | 272 | 177 | 57 | |||
| Technical revisions | 599 | 431 | (419 | ) | ||
| Acquisitions | – | – | – | |||
| Dispositions | (948 | ) | (1,020 | ) | (1,209 | ) |
| Economic factors | (246 | ) | (320 | ) | (286 | ) |
| Production | (836 | ) | (836 | ) | (836 | ) |
| Closing balance, December 31, 2015 | 2,545 | 3,712 | 6,517 | |||
The Company will provide more detailed information from its current reserves report in its annual information form for the year ended December 31, 2015, which will be filed this week.
Total future development costs included in the reserves evaluation were $23.7 million for TP reserves and $45.7 million for P&P reserves on an undiscounted basis. Future development costs included in TP and P&P reserves decreased 18% and 31% respectively from 2014 due to capital cost reductions related to lower costs of services and more efficient completion techniques in 2015, as well as a small decrease in the number of locations included in the report.
The Company’s finding, development and acquisition costs as of December 31, 2015 were indeterminate, as the significant dispositions outstripped the field capital expenditures undertaken in 2015.
Oil and NGL as a percentage of total MBOE reserves has increased to 46% of PDP, 51% of TP and 52% of P&P reserves from 38%, 40% and 44% respectively in 2014, when the Company set a goal of achieving at least 50% liquids in the reserves base.
UNDEVELOPED LAND
Anderson has 64,825 gross (25,673 net) undeveloped acres of land at December 31, 2015. Undeveloped land value has been estimated at $1.8 million by management.
Subsequent to December 31, 2015, the Company acquired over 7,800 additional undeveloped acres of 100% working interest land at crown land sales in Alberta, and disposed of 3,163 gross (94 net) acres of land pursuant to shallow gas asset sales.
The lands acquired relate to a new medium depth horizontal oil development project in central Alberta targeting the Duvernay Carbonates.
NET ASSET VALUE
The Company completed a net asset value estimate using the GLJ December 31, 2015 price and cost assumptions, pro forma the repayment of the Series A Debentures and the redemption of the Series B Debentures for common shares. This calculation is done assuming the Series B Debentureholders approve the Exchange Transaction on April 1, 2016.
| (dollars in thousands, except per share amounts) | 10% | 12% | 15% | |||
| After tax P&P reserves at December 31, 2015 (1) | $64,984 | $58,598 | $50,852 | |||
| Add undeveloped land (2) | 1,800 | 1,800 | 1,800 | |||
| Add adjusted net working capital (3) | 6,745 | 6,745 | 6,745 | |||
| Add adjustments related to settlement of debentures (4) | 712 | 712 | 712 | |||
| Deduct decommissioning obligations not included in GLJ Report (1) | (6,710 | ) | (5,917 | ) | (5,114 | ) |
| Net asset value (5) | $67,531 | $61,938 | $54,995 |
| (1) GLJ includes well abandonment and reclamation costs for all wells with reserves. Abandonment and reclamation costs associated with non-reserves wells and major facilities have not been included in the GLJ Report and are deducted separately for the purpose of this net asset value estimate. |
| (2) Management estimate based on publicly available information with respect to recent land sale activity. |
| (3) Adjusted net working capital is current assets less current liabilities at December 31, 2015 before unrealized gains and losses on derivative contracts and the current portion of convertible debentures. |
| (4) Adjustments to working capital for interest expense accrued and included in working capital at December 31, 2015 of $1,562,500 that was paid in common shares versus cash in January 2016, less estimated costs associated with the settlement of debentures of $850,000. |
| (5) Does not include management’s estimated value for approximately 74% of the Cardium net potential drilling opportunities that are not included in the GLJ reserves report at December 31, 2015, nor management’s estimated value for Duvernay Carbonate light oil horizontal potential drilling opportunities. |
EXCHANGE TRANSACTION
On January 31, 2016, the Company exercised its right to repay both the principal amount ($50.0 million) and the accrued and unpaid interest ($1.875 million) on the Series A Debentures in common shares of the Company, pursuant to a maturity notice delivered in December 2015 to the holders of the Series A Debentures. The Company issued approximately 9.171 billion common shares from treasury at approximately $0.00565616 per share in regards to that repayment. The exchange price was based on 95% of the 20 day volume weighted average trading price of the common shares on the Toronto Stock Exchange (“TSX”) ending five days prior to the maturity date.
On February 26, 2016, the Company announced a proposed transaction to exchange the entire principal amount of the Series B Debentures ($46.0 million), and the interest that would otherwise accrue on the Series B Debentures to June 30, 2016 ($1.67 million) for common shares of the Company on the basis of a price of $0.00565616 per share, for approximately 8.428 billion common shares issued from treasury. The Company has scheduled a meeting of the Series B Debentureholders to consider the Exchange Transaction on April 1, 2016. Pursuant to the existing indenture, an extraordinary resolution approving the Exchange Transaction is required to be passed at a meeting of the Series B Debentureholders in which the holders of not less than 25% of the principal value of the Series B Debentures outstanding are present in person or by proxy. The extraordinary resolution must be passed by 66 2/3% of the votes represented at the meeting. Approximately 36% of the Series B Debentureholders have signed support agreements pursuant to which they have agreed, among other things, to vote the Series B Debentures beneficially owned or controlled or directed by them, directly or indirectly, in favour of the Exchange Transaction and all matters related thereto at the meeting. The Exchange Transaction is subject to approval by the TSX. If the Exchange Transaction does not receive sufficient support from the Series B Debentureholders, the Company intends to exercise its right under the terms of the existing indenture (as supplemented) governing the Series B Debentures to repay both the principal and the accrued and unpaid interest in common shares at the earliest possible redemption date, which is June 30, 2016.
SHARE CONSOLIDATION
If the Exchange Transaction is approved by the Series B Debentureholders, the Company will put forward a special resolution to be voted on by the common shareholders at its next annual meeting, expected to be held in May 2016, to approve a share consolidation at a ratio to be determined by the board of directors of Anderson. A share consolidation is also known as a “reverse stock split”.
If the Exchange Transaction is not approved by the Series B Debentureholders, the share consolidation will be delayed until sometime after the June 30, 2016 redemption date for the Series B Debentureholders.
As a result of the issuance of common shares on the repayment of the Series A Debentures and the planned issuance of common shares to settle the Series B Debentures, Anderson expects to have in excess of 17 billion common shares outstanding. The current trading price is $0.005 per common share and trading is very light.
The purpose of doing a share consolidation is to reduce the number of outstanding shares in order to improve the trading liquidity of the common shares.
PEOPLE
On September 3, 2015, J.C. Anderson, a founder and director of Anderson passed away. J.C. was a legend in the oil and gas industry and he will be deeply missed by all of those who had the privilege to know him.
On March 23, 2016, Elias A. Foscolos was appointed to the board of directors. Elias has a Bachelor of Science degree in Chemical Engineering and a Master of Business Administration. He is currently working as a research analyst in the energy services industry and as a lecturer at the University of Calgary in the Finance department. He has over 25 years of experience in engineering and financial consulting.
SUMMARY
In 2015, the Company shut down its drilling program in response to the collapse in commodity prices. It focused its efforts on reducing both G&A and operating expenses with initiatives undertaken in April 2015 and continuing through to March 2016. The Company also continued its efforts to transition away from shallow gas production through a variety of disposition and abandonment initiatives, to allow it to focus on its horizontal oil plays. As of January 2016, 85% of Anderson’s production and 88% of its P&P reserves come from the Cardium formation. In 2015, the Company reduced its producing and non-producing net well count by 31% and expects to make further significant reductions in 2016.
Strategically, in 2016, a significant new horizontal oil development project has been added to the Company’s portfolio in central Alberta targeting the Duvernay Carbonates.
The Company has cash in the bank, unused bank lines and a sizable inventory of Cardium potential drilling opportunities. In the second quarter of 2016, the Company expects to have settled all of its outstanding convertible debentures. Once a share consolidation is completed, the Company should be more attractive to both investors and industry participants. The industry and its workforce is going through a very difficult downturn. It is difficult to predict when this will turn around and what structural and political changes await the industry. Although the Company is about to be debt free with cash in the bank, it still needs higher commodity prices to invest in its drilling projects.
The Company has hunkered down, waiting for an eventual improvement in oil prices. Company engineers estimate that with a $50 WTI US per bbl oil price, the Company can achieve a 12 month payout with new drilling projects. Historically, the Company has been an industry leader in IP 30 Cardium well results and in achieving low capital costs per well in the Cardium play. When drilling resumes, the Company expects to resume its position as a leader on both parameters in this play.
I appreciate the support of the Board of Directors and the financial sacrifices that staff and management had to make to reposition the Company for the future. Anderson’s most recent investor presentation will be posted on the Company’s website at www.andersonenergy.ca.
Thank you for your continued patience.
Brian H. Dau
President & Chief Executive Officer
March 29, 2016
FORWARD-LOOKING STATEMENTS
Certain statements in this news release including, without limitation, management’s business strategy and assessment of future plans and operations; benefits and valuation of the development prospects described herein; number of potential drilling opportunities; drilling program success; timing and location of drilling and tie-in of wells and the costs thereof; timing of shut-in and abandonment of wells and impact thereof; productive capacity of the wells; expected production rates and risks to such expectations; improved production from slick water fracture technology; percentage of production from oil, condensate and natural gas liquids; dates of commencement of production; amount of capital expenditures and the timing and method of financing thereof; value of undeveloped land; reserves and net present value of future net revenue from reserves; ability to attain cost savings and amount thereof; tax horizon; expectations related to future operating netbacks; impact of changes in commodity prices on operating results; programs to optimize, rationalize, consolidate and improve profitability of assets, including the impact from shutting-in or abandonment of wells; factors on which the continued development of the Company’s oil and gas assets are dependent; the impact of the TCPL outages on past and future production; benefits of recently completed transactions including the result on the Company’s liquidity;
benefits of the Exchange Transaction and the impact of the Exchange Transaction on Anderson and its capital structure, financial position, liquidity and net asset value, including that the Exchange Transaction will create a financially stronger company and better allow for the pursuit of its business and operational goals; growth potential of Anderson’s asset base; the results of the annual review of Anderson’s bank facility; Anderson’s common share interests assuming the completion of the Exchange Transaction; Anderson’s ability to implement its plans relating to the Exchange Transaction and the share consolidation; anticipated dates and information relating to the Series B Debentureholder meeting, the closing of the Exchange Transaction and the timing of the share consolidation; Anderson’s intentions if the Exchange Transaction is not approved; the potential outcome of litigation and disputes; commodity price outlook; and general economic outlook may constitute “forward-looking information” within the meaning of applicable securities laws and necessarily involve risks and assumptions made by management of the Company including, without limitation, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation; loss of markets; volatility of commodity prices; currency fluctuations; imprecision of reserves estimates; environmental risks; competition from other producers; inability to retain drilling rigs and other services; adequate weather to conduct operations; sufficiency of budgeted capital, operating and other costs to carry out planned activities; wells not performing as expected; incorrect assessment of the value of acquisitions and farm-ins; failure to realize the anticipated benefits of acquisitions and farm-ins; delays resulting from or inability to obtain required regulatory approvals; changes to government regulation; availability of third-party transportation and processing facilities; ability to access sufficient capital from internal and external sources; ability of Anderson’s common shares to remain listed on the TSX; the receipt in a timely manner, of regulatory and Series B Debentureholder approval in respect of the Exchange Transaction; the plans of Series B Debentureholders and other counterparties related to the Exchange Transaction; the expected costs of the Exchange Transaction; and other factors, many of which are beyond the Company’s control.
The impact of any one risk, uncertainty or factor on a particular forward-looking statement is not determinable with certainty as the factors are interdependent, and management’s future course of action would depend on its assessment of all information at the time. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements and readers should not place undue reliance on the assumptions and forward-looking statements. Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect Anderson’s operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com) or at Anderson’s website (www.andersonenergy.ca).
The forward-looking statements contained in this news release are made as at the date of this news release and the Company 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 laws.
CONVERSION MEASURES AND SHORT-TERM PRODUCTION RATES
Production volumes and reserves are commonly expressed on a BOE basis whereby natural gas volumes are converted at the ratio of six thousand cubic feet to one barrel of oil. Although the intention is to sum oil and natural gas measurement units into one basis for improved analysis of results and comparisons with other industry participants, BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of six Mcf to one 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. In recent years, the value ratio based on the price of crude oil as compared to natural gas has been significantly higher than the energy equivalency of 6:1, and utilizing a conversion of natural gas volumes on a 6:1 basis may be misleading as an indication of value.
Short-term production rates can be influenced by flush production effects from fracture stimulations in horizontal wellbores and may not be indicative of longer-term production performance or reserves. Individual well performance may vary.
ABBREVIATIONS
| bbl – barrel bpd – barrels per day BOE – barrels of oil equivalent BOED – barrels of oil equivalent per day m3 – cubic meters Mbbls – thousand barrels MBOE – thousand barrels of oil equivalent Mstb – thousand stock tank barrels NGL – natural gas liquids, excluding condensate WTI – West Texas Intermediate |
AECO – intra-Alberta Nova inventory transfer price Bcf – billion cubic feet Btu – British thermal unit GJ – gigajoule Mcf – thousand cubic feet Mcfd – thousand cubic feet per day MMBtu – million British thermal units MMcf – million cubic feet scf – standard cubic foot US – United States |
|
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VANCOUVER, BRITISH COLUMBIA–(Marketwired – March 28, 2016) – Lithium Americas Corp. (“Lithium Americas”, or “LAC”) (TSX:WLC)(OTCQX: WLCDF) (formerly Western Lithium USA Corporation) is pleased to announce a definitive agreement with Sociedad Química y Minera de Chile S.A. (“SQM”) (NYSE:SQM)(SSE:SQM.B)(SSE:SQM.A) to enter into a 50/50 joint venture (the “Joint Venture“) on the Cauchari-Olaroz lithium project in Jujuy, Argentina (the “Joint Venture Transaction“).
The Joint Venture will go into effect following a capital contribution of US$25 million by SQM in exchange for a 50% ownership stake in Minera Exar S.A. (“Minera Exar”), a wholly owned subsidiary of LAC. SQM’s contribution includes US$15 million to repay intercompany loans between Minera Exar and LAC; the remaining US$10 million will be allocated to project development. SQM and LAC intend to immediately advance a work and engineering plan, which contemplates completion of an updated definitive feasibility study based on an existing study for Cauchari that was completed by Minera Exar in 2012. The updated study will evaluate economic feasibility for a project with a nameplate production capacity of approximately 40,000 metric tons per year of lithium carbonate equivalent. Depending on the results of the study, the project may be executed in stages.
Tom Hodgson, Chief Executive Officer of LAC, commented, “SQM is the world leader in lithium production with decades of development and operating experience and a strong team of technical and commercial talent. It also has a track record of success as a partner in many global joint ventures. One of the principal objectives of the Joint Venture is to leverage the technical experience of SQM to materially de-risk the development of Cauchari-Olaroz and to successfully advance the project to bring new supply to the market on a timely basis. Lithium plays an important strategic role in the energy revolution and it is critical that our industry respond by delivering more supply to meet increasing demand.”
Patricio de Solminihac, Chief Executive Officer of SQM, commented, “SQM is committed to the lithium business, both in Chile and abroad. The Salar de Caucharí is a great complement to our existing lithium operations in Chile, and it is located just a few hundred kilometers from the Salar de Atacama. We expect to have similar production processes at both sites, and as a result we should benefit from operating synergies.”
Mr. de Solminihac continued, “We are confident that this joint venture will generate value for our shareholders. We believe that SQM’s years of experience in the lithium business, and our vast distribution network, combined with LAC’s knowledge of the Salar de Caucharí and its stakeholders, will prove to be key advantages that will contribute to the success of this project.”
Recognizing that over the past seven years well over US$1 billion has been invested globally in lithium development projects which has resulted to date in minimal increase in lithium supply, Lithium Americas has been evaluating options to ensure Cauchari-Olaroz is brought into production in a timely manner with the lowest possible development risk. Lithium Americas has considered proposals from potential partners from various parts of the world, and from leading companies representing different parts of the lithium battery supply chain. Lithium Americas has evaluated traditional and new processing technologies, and has also examined the possibility of developing Cauchari-Olaroz on a stand-alone or independent basis.
John Kanellitsas, Vice Chairman of Lithium Americas, commented, “Lithium Americas’ board has determined that SQM represents the premier partner in the world for our project. Their understanding of brine chemistries, pond and chemical plant construction, knowledge of all end-user product specifications and the collaborative approach with our team were important criteria in our selection process. We believe that SQM is the world’s largest and lowest cost producer of lithium from brines and our board has determined that a joint venture with SQM in which we pursue a production path utilizing a proven, low-cost brine evaporation process represents the optimal course to maximize long term value for Lithium Americas’ shareholders.”
Cauchari-Olaroz is believed to be the world’s 3rd largest lithium brine resource and is fully permitted for immediate construction and development. The project benefits from excellent infrastructure including a nearby natural gas pipeline, a paved international highway with direct access to Salar de Atacama and a deep sea port, fresh water on site, and strong support from local communities and the government of Jujuy province. Since its inception in 2009, Lithium Americas has invested over CDN$80 million in a resource exploration and project development program which includes resource definition, advanced modeling, approximately 10,000 meters of drilling, testing and pumping wells and 43-101 technical studies, including a definitive Feasibility Study (“dFS”) completed in 2012. The 2012 dFS was based on a production capacity of 20,000 TPA lithium carbonate and resulted in a post-tax NPV of US$464M with average annual net cash flows of US$117M, and was based on forecasted LCE average prices of approximately US$5,900, well below current world prices. The Joint Venture is targeting a production capacity of approximately 40,000 TPA lithium equivalent in its upcoming development plan investigations.
Franco Mignacco, President of Minera Exar, commented, “We are very pleased to welcome our neighbor SQM as our partner to advance the project in Jujuy Province of Argentina, which is fully permitted and ready for construction. As stewards of one of the world’s great lithium brine resources at the Cauchari salar, we are delighted to enter into this commercial partnership with SQM, who will be investing both its capital and its talent. The Joint Venture also demonstrates success for all stakeholders and local communities from the policies of the new Argentine government in its desire to attract foreign investment.”
Information of a scientific and technical nature in this news release in respect of the Cauchari-Olaroz Lithium Project has been approved by Roger Kelley (Chem. Eng.), a qualified person for purposes of National Instrument 43-101. For further information about the dFS, please refer to the Technical Report dated July 11, 2012, entitled “Feasibility Study, Reserve Estimation and Lithium Carbonate and Potash Production on the Cauchari-Olaroz Salars, Jujuy Province, Argentina” filed on LAC’s SEDAR profile on December 23, 2015.
About Lithium Americas
Lithium Americas is the parent company of Minera Exar S.A., which is developing the Cauchari-Olaroz Lithium Project, located in Jujuy, Argentina, in a joint venture with SQM. Lithium Americas also is the parent to Lithium Nevada Corp., which owns one of the largest lithium resources in North America, and Hectatone Inc., which produces specialty drilling additives and other organoclay products.
Forward-looking statements
Statements in this release that are forward-looking information are subject to various risks and uncertainties concerning the specific factors disclosed here and elsewhere in the company’s periodic filings with Canadian securities regulators. When used in this document, the words such as “expect,” “believe,” “planned”, “scheduled,” “targeting” and similar expressions is forward-looking information. Information provided in this document is necessarily summarized and may not contain all available material information.
Statements in this release that constitute forward-looking statements or information include, but are not limited to: (i) timing of completion of a new feasibility study and expected production outcomes from that study; and (ii) the size and production cost applicable to SQM’s lithium brine operations.
All such forward-looking information and statements are based on certain assumptions and analyses made by Western Lithium management in light of their experience and perception of historical trends, current conditions and expected future developments, as well as other factors management believes are appropriate in the circumstances. These statements, however, are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information or statements. Important factors that could cause actual results to differ from these forward-looking statements include those described under the heading “Risks Factors” in the Western Lithium’s most recently filed MD&A. The company does not intend, and expressly disclaims any obligation to, update or revise the forward-looking information contained in this news release, except as required by law. Readers are cautioned not to place undue reliance on forward-looking information or statements.
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Nevada Energy Metals (TSXV:BFF) (OTC Pink:SSLMF) announced that an initial near surface exploration program on our 100% owned Teels Marsh West claims which covers approximately 810 hectares (2000 acres) in Mineral County, Nevada will commence next week.
As quoted in the press release:
Lithium concentrations of up to 850 ppm have been reported from earlier sampling programs conducted by the US Geological Survey (OFR: 76-567) at Teels Marsh.
This initial phase of the lithium detection sampling will consist of 20 shallow auger holes. This drill program is designed to collect fluid and sediment samples in close proximity to a recently discovered thermal area located on and adjacent to a range front fault system along the west side of Teels Marsh. This thermal anomaly was discovered during research into the relationship between geothermal systems and Quaternary borate deposits previously mined at Teels Marsh (Coolbaugh et al. 2006). Close proximity to a geothermal heat source is believed to be one of the principal requirements for concentrating lithium in the brines at Clayton Valley, home to the first commercial lithium brine operation in North America.
Connect with Nevada Energy Metals (TSXV:BFF) (OTC Pink:SSLMF) to receive an Investor Presentation.
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It was a short week for the S&P/TSX Venture Composite index (INDEXTSI:JX) ahead of the Easter long weekend. It finished fairly flat, up 0.67 percent at 580.02 points.
Meanwhile, a number of companies in the mining and resources sector saw more significant rises. Catalyst Copper (TSXV:CCY) was the top-gaining stock in the space, and it was followed by Lupaka Gold (TSXV:LPK), Otis Gold (TSXV:OOO), Houston Lake Mining (TSXV:HLM) and Euromax Resources (TSXV:EOX).
Shares of Catalyst Copper gained 60.42 percent this week to reach $0.39 following news that the company plans to merge with Newcastle Gold (TSXV:NCA). The company will be focused on Newcastle’s Castle Mountain gold project in California, with the aim of creating a new mid-tier gold company. The company will be headed by Richard Warke, Jim Gowans and Frank Giustra.
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Updated December 2015
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Lupaka Gold holds the Invicta and Crucero gold projects in Peru, and also has an option to earn a 65-percent interest in the Josnitoro gold project. On February 22, the company reported results from its second run-of-mine bulk test using material from the Atenae vein at Invicta. There has been no additional news that would explain this week’s rise in share price for the company. Lupaka gained 37.5 percent this week to finish at $0.17.
Shares of Otis gold were up 34.62 percent this week at $0.175. The gold explorer is focused on building a portfolio of precious metals properties in Idaho, with its flagship property being the advanced exploration-stage Kilgore project.
Otis appointed Dr. Tim Miller as a director on February 25, and said more recently that it will present at the John Tumazos Very Independent Research Metals & Natural Resources Conference at the end of this month. However, there has been no further news from the company that would explain this week’s rise in share price. Share of Otis have gained 30 percent so far in 2016.
Houston Lake is focused on developing its PAK hard-rock lithium project in Northwestern Ontario. The company gained 30.43 percent to close at $0.30 this week.
Houston Lake put out an upgraded resource estimate for the PAK project earlier this month, marking a 206-percent increase in measured and indicated lithium resources relative to the previous estimate. The company also announced a $680,000 financing on March 18 to fund further exploration work at the project. There has been no further news to explain the rise in share price for Houston Lake this week.
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Rounding out the list is Euromax Resources, which saw its shares rise 28.89 percent this week to hit $0.58. The company is focused on its Ilovica project in Macedonia, for which it released a feasibility study on January 6. On March 21, Euromax announced the appointment of Raymond Threlkeld, currently executive chairman of Newmarket Gold (TSX:NMI), as a director. There was no additional news from the company this week that would explain its rise in share price.
Data for 5 Top TSXV Stocks articles is retrieved each Friday after market close using The Globe and Mail’s market data filter. Only companies with a market capitalization greater than $10 million prior to the week’s gains are included. Companies within the mining and precious metals sectors are considered.
Securities Disclosure: I, Teresa Matich, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Otis Gold is a client of the Investing News Network. This article is not paid-for content.
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Nemaska Lithium Inc. (TSXV:NMX,OTCQX:NMKEF) announced it has closed a non-brokered private placement of $13-million by the issuance of 38,235,295 units at a price of 34 cents per unit in favour of Ressources Quebec Inc., acting as mandatory for the government of Quebec, and Nemaska Development Corp.
The corporation intends to use the net proceeds of the private placement for the construction and operation costs of the phase 1 plant that will produce lithium hydroxide and for general expenses.
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Gold was boosted briefly on Tuesday when attacks in Brussels spurred safe-haven demand for the metal, but is now on track to record its largest weekly loss in over four months.
According to Reuters, the yellow metal sank to $1,212.20 per ounce early Thursday, its lowest since February 26. Market watchers have attributed gold’s fall to anxiety about the US Federal Reserve — while the central bank left interest rates unchanged last week, since then fears that the Fed’s next rate hike will come sooner rather than later have ramped up.
Explaining the situation, James Steel, a strategist at HSBC, told The Wall Street Journal, “the shift in investor focus … back to monetary policy and recent hawkish Fed official comments gives the market rationale to correct still lower.”
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Updated December 2015
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As of 12:48 p.m. EST on Thursday, gold was trading at $1,221.
For its part, the silver price fared much the same as gold did this week. While it started the week off strong, also getting a boost from Brussels turmoil on Tuesday, it’s since dropped and was sitting at $15.20 per ounce as of 12:00 p.m. EST on Thursday.
While that’s not the best news, silver bugs did see some excitement this week when CME Group (NASDAQ:CME) and Thomson Reuters (TSX:TRI,NYSE:TRI) announced plans to implement measures that will “further enhance and develop the LBMA Silver Price Benchmark.” The new measures include introducing a blind auction and sharing the imbalance in the auction.
On the base metals side, benchmark LME copper was down 0.4 percent, at $4,930 per tonne, in Thursday morning trade. Reuters states that the metal’s fall came “as a stronger dollar triggered profit-taking ahead of the Easter holiday weekend.” That said, its losses were limited by optimism about Chinese demand.
“Base metals are reacting to the dollar, looks like profit-taking before the Easter holiday. Our survey of Chinese demand shows things are not roaring, but they are picking up,” Macquarie Group’s (ASX:MQG) Vivienne Lloyd told the news outlet.
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Finally, oil prices recovered Thursday after taking a nosedive Wednesday, another Wall Street Journal article states. Wednesday’s fall was triggered by US Department of Energy data showing that US crude supply increased by 9.4 million barrels last week — much higher than analyst estimates. The oil space took another hit earlier in the week after doubt was cast on prospects for a production freeze from OPEC.
By Thursday, the benchmark US oil contract was down 1.4 percent on the NYMEX, at $39.20 per barrel, while the global Brent benchmark was down 0.7 percent, at $40.19, on the ICE Futures Exchange Europe.
Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
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International Lithium (TSXV:ILC.V) has acquired 464 hectares of mineral claims in the Kenora mining district of Ontario. The claims are subject to a 1 percent NSR to the vendor, purchasable at any time for $1 million.
As quoted in the press release:
The Raleigh Project (“Raleigh”) is located about 7km south of the Trans-Canada Highway, 20 km west of Ignace, Ontario and approximately 270km west of Thunder Bay, Ontario. Access to key parts of the property from the Trans-Canada Highway is by secondary roads and forest access roads. The city of Dryden is approximately 80 km west by highway 17, making the Company’s recently announced Mavis joint venture approximately 60 kilometres away.
Click here for the full press release.
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ALX Uranium Corp. (TSXV:AL, FWB:6LLN, OTCQX:ALXEF) announced that geophysical programs are complete at its Hook-Carter Propertylocated in the Patterson Lake South area in the southwestern Athabasca Basin, Saskatchewan.
According to the news:
Work consisted of an advanced combined airborne and ground Sub-Audio Magnetic Transient Electromagnetic (HeliSAM TEM) geophysical survey conducted by Gap Discovery Geophysics over the Patterson and Carter Corridors of the Hook-Carter Property. The survey lines were flown 100 metres apart with a helicopter-borne transient EM receiver and covered two large areas approximately 3.8 km long by 1.9 km wide (W1/W2 area) and 2.3 km long by 1.9 km wide (A1 area). A total of 115 line-km of HeliSAM TEM was completed.
Click here to view the full press release.
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A recent report by Epstein Research highlighted Critical Elements (TSXV:CRE,OTCQX:CRECF,FWB:F12) as an emerging specialty metals company, focused on its Rose Lithium-Tantalum project in northern Quebec.
As quoted in the report:
The Company’s very promising RL-T project is backed by a Preliminary Economic Assessment (“PEA”) [see pages 9-12] and very strong (current) LC prices, up from about US$5,500/Mt in October 2015 to a reported $20,000+/Mt today. Importantly, Critical Elements is no newcomer to the lithium scene, it has been advancing its RL-T project since late 2009. A total of 181 drill holes totaling 26,500 meters have been drilled to date. Out of the 181 drill holes, 175 returned significant mineralized values.
Assuming a LC price of US$6,000/Mt, the PEA highlights a NPV(8%) & IRR of C$279 million & 25%, respectively. The NPV(10%) is C$223 million. The assumed USD/CAD FX rate in the PEA is at parity. However, if today’s C$ 0.77 FX rate were to be incorporated, the NPV (in C$ dollars) would be much higher. Management also points out that the Company has made noteworthy improvements in recoveries since the PEA was done. Spodumene recovery is around 90% at a grade of 6.4% Li2O, and a robust 94% recovery on the carbonation process for Li2CO3. The industry average is around 80% for spodumene and 85% for carbonation.
Therefore, I believe that the Company’s stock has tremendous room to run, especially if management can lock down non-dilutive funding. Critical Elements Corp. (TSX-V: CRE) (US OTCQX: CRECF) is a company worth watching. The stock price has already begun to move, but the valuation is still cheap given the fundamental strength in lithium prices and company specific attributes that make it less risky than global lithium peers at similar stages of development. Critical Elements’ PEA is strong, possibly with room for improvement from a much more favorable FX rate and stronger reported lithium recoveries.
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2015 was another positive year for the lithium market. While prices for many other metals and energy commodities felt significant pressure last year, lithium prices have been on a tear, and continued developments from Tesla Motors (NASDAQ:TSLA) stoked further interest in the mineral.
Two junior miners announced conditional agreements to supply lithium to Tesla’s lithium-ion battery gigafactory in Nevada. First was Bacanora Minerals (TSXV:BCN,LSE:BCN) and joint venture partner Rare Earth Minerals (LSE:REM), which hold the Sonora lithium project in Mexico, and second was Pure Energy Minerals (TSXV:PE) with the Clayton Valley project in Nevada.
Analysts have commented that the deals are light on detail and represent more of an “out of the money call option” strategy. Still, with Tesla announcing an expansion into the energy storage market, rising lithium demand from the battery space is garnering as much interest as ever.
And for good reason. With supplies looking tight and demand set to keep increasing, upward price pressure is expected to continue for lithium products in 2016.
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Overall, given the growing importance of energy metals and lithium-ion batteries, securing a consistent supply of lithium is a top priority for technology companies around the world. Lithium’s uses extend far beyond rechargeable batteries, but many predict that this application will dominate demand for the metal in coming years.
Here are the world’s top lithium-producing countries from 2015, as reported by the US Geological Survey (USGS).
Mine production: 13,400 MT
In 2015, Australian mines delivered 13,400 metric tons (MT) of lithium, an increase of 100 tons from the year prior. The country is home to the Greenbushes lithium project, which is owned and operated by Talison Lithium, a subsidiary jointly owned by China’s Tianqi Group and US based Albemarle (NYSE:ALB). Greenbushes is the world’s largest known single lithium reserve, and has been operational for over 25 years. The location is a boon to lithium producers, as it provides relatively easy access for Asian electronics companies, which are the world’s top lithium consumers.
Junior mining companies such as Pilbara Minerals (ASX:PLS) are also advancing lithium projects in Australia, while Galaxy Resources (ASX:GXY) is working to restart production at its Mt Cattlin spodumene project in Western Australia.
Australia holds roughly 1.5 million MT of lithium reserves, according to the USGS. It’s worth noting that much of Australia’s mined production is exported to China in the form of hard-rock spodumene, where it is then further processed into end products such as lithium carbonate and lithium hydroxide.
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Mine production: 12,900 MT
Chile provided the second-highest amount of lithium last year, upping its production from 11,500 MT in 2014 to 11,700 MT last year. Overall, Chilean mines feature the largest confirmed lithium reserves in the world, with over 7,500,000 MT of lithium. By that estimate, the country hosts roughly five times more lithium than Australia, which features the second-largest reserves.
In particular, the Atacama salt flat is the most significant source of Chile’s massive lithium production. BBC News reported that one project alone encompasses approximately 20 percent of the world’s total lithium. While Australia extracts lithium from traditional hard-rock mines, Chile’s lithium is found in brines below the surface of salt flats.
These brines are collected and treated in order to separate the lithium from wastewater. The region is extremely arid, making it conducive to lithium extraction via evaporation ponds.
Mine production: 3,800 MT
Argentina increased its lithium production by 600 MT in 2015 to overtake China as the world’s third largest lithium producer last year. Bolivia, Argentina and Chile comprise the “lithium triangle,” and Argentina benefits from the same geological conditions that created the lithium-rich salt flats that fuel Chilean lithium production.
The most important salt flat in Argentina is the Salar del Hombre Muerto. While the high lithium content of this area is well documented, projects are still in development. For example, many analysts are still watching for Orocobre (TSX:ORL) to further ramp up production at its Olaroz facility in the country.
Meanwhile, the recent election of Mauricio Macri in Argentina is already bringing a political shift that is expected to be a win for the mining industry in the country.
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Mine production: 2,200 MT
China trailed behind in terms of mined production, putting out just 2,300 MT of lithium during 2015, according to the USGS. That represents a drop of 100 MT of production from 2015.
The country’s massive electronics manufacturing industry means that China is also the world’s largest consumer of lithium; however, China’s lithium industry has yet to fully ramp up lithium extraction. Currently, the majority of Chinese lithium comes from the Chang Tang plain in Western Tibet, according to China Dialog.
That said, the country is rushing to develop its lithium production capacity, and has plenty of room to grow. The US Geological Survey pegs the country’s lithium reserves at 3,500,000 tons.
For now, as mentioned above, China gets much of its raw lithium supply from Australia. That system is working well so far; as the Investing News Network has previously noted, Chinese companies Sichuan Tianqi Lithium and Jiangxi Ganfeng Lithium are two of the top producers of lithium products worldwide.
Mine production: 900 MT
Zimbabwe’s lithium output held steady from 2014, with the country putting out 900 MT of the mineral last year. Privately held Bikita Minerals controls nearly all of the country’s lithium mining, and announced expansion plans in the summer of 2014, according to the Zimbabwe Mail.
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Mine production: 300 MT
While Portugal put out significantly less lithium than the other countries on this list, it remains a major player in the lithium industry. Overall, the country produced 300 tons of lithium last year.
The majority of the country’s known lithium stores are centrally located in the Goncalo aplite-pegmatite field. There are other areas of the country that may contain large amounts of lithium, but further exploration will be required to determine whether these deposits could be developed economically.
Mine production: 160 MT
Similarly, Brazil contributed 160 tons of lithium to global output in both 2014 and 2015. The country has deposits of the mineral in a few northern areas, including Minas Gerais and Ceara, but Brazil’s known lithium reserves remain relatively small.
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Mine production: undisclosed
Rounding out the top lithium producers for 2014 was the United States. The US is home to a single lithium mine controlled by Rockwood Holdings, which was acquired by Albemarle in 2015. The brine operation is located in Nevada, and accounts for all of the country’s lithium output. The US Geological Survey does not release national production numbers to protect the company’s trade secrets.
Nevada has become a hot spot for lithium juniors, with companies such as Dajin Resources (TSXV:DJI,OTCMKTS:DJIFF) and Pure Energy Minerals (TSXV:PE) conducting exploration work on brines in the state.
This is an updated version of an article originally published on Lithium Investing News on April 8, 2015.
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The Wall Street Journal reported that oil prices dipped Wednesday on reports of higher inventories in the US.
As quoted in the publication:
Total commercial stocks of oil and refined fuels rose by 9.9 barrels to 1.354 billion barrels as of Friday, the U.S. Energy Information Administration said. That largely came from crude, which added 9.4 million barrels, an addition that outpaced analysts’ expectations, industry estimates and a strong draw from gasoline stockpiles.
Light, sweet crude for May delivery recently fell $1.19, or 2.9%, to $40.26 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, traded down $1.02, or 2.4%, to $40.77 a barrel on ICE Futures Europe.
Click here for the full press release.
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InPex (TYO:1605) and Royal Dutch Shell (NYSE:RDS.A) have hit a setback in the development of their $14.8 billion Indonesian gas project. According to the Wall Street Journal, the companies’ plan for a large floating refinery has been rejected.
As quoted in the publication:
Japan’s Inpex, the project’s planned operator, and partner Shell proposed six months ago to build a massive floating facility to exploit an offshore gas block known as Masela. The offshore plan had the support of Indonesia’s energy ministry, but late last year, ministers clashed over whether to instead force the project to pipe the gas to onshore facilities up to 600 kilometers away, which Inpex and Indonesia’s upstream oil-and-gas regulator said would add up to $7.5 billion to the cost.
Click here for the full Wall Street Journal article.
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Lithium X Energy (TSXV:LIX) has secured the necessary permits from the Bureau of Land Management for four drill holes at its Clayton Valley North lithium project in Nevada.
As quoted in the press release:
The work forms part of the Phase 1 exploration program at Clayton Valley North and results, if positive, will be incorporated into a maiden resource estimate
The Company is permitted to drill four exploration holes on two drill sites that will target potential lithium-brine-bearing formations, including a basal gravel aquifer that lies at the base of the valley. The initial drill program was designed by David Hawkins, Chief Hydrogeologist for Lithium X, with assistance from Will Randall, the Company’s VP of Project Development. A third site, consisting of two drill holes, shall be determined based on the results of these first two drill sites.
Lithium X CEO, Brian Paes-Braga, said:
We are pleased to have permits in hand for the first phase of drilling and are now in the process of securing equipment and drill crews. We are progressing well and anticipate collaring our first exploration core hole in the second quarter.
Click here for the full press release.
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Western Lithium (TSX:WLC) will change its name to Lithium Americas. It’s wholly owned subsidiary, Western Lithium Corporation, will also see its name changed to Lithium Nevada.
Western Lithium and Lithium Americas merged last June.
As quoted in the press release:
Effective Wednesday, March 30th the Company will commence trading on the Toronto Stock Exchange (“TSX”) under the new name and symbol “LAC” and on the OTCQX, under the new name with a symbol to be announced prior to the effective date.
The company also provided a number of corporate updates, stating that it expects to make an announcement regarding advanced discussions with potential strategic partners at its Cauchari-Olaroz project soon:
Update on Minera Exar and Argentina Reforms:
The Company remains in advanced discussions with potential strategic partners at Cauchari-Olaroz and hopes to make an announcement soon. Given the strong global demand for lithium and the fully permitted status of the Cauchari-Olaroz project, the Company frequently receives indications of interest from leading companies representing different parts of the lithium supply chain from various parts of the world. Lithium Americas has been evaluating potential strategic partners and new extraction processing technologies in comparison to the economics established in the 2012 definitive Feasibility Study (“dFS”) using traditional processing.
At the recent Prospectors & Dealers Association Conference in Toronto, the Argentine Minister for Energy and Mines gave a presentation summarizing “Argentina is Waiting for You; the Best is Yet to Come” highlighting how Argentina in just 20 years, and despite the last decade’s challenges, is among the world’s top producers of lithium, boron, silver, gold, copper, lead, and zinc.
Since taking office in December 2015, President Mauricio Macri has moved swiftly to appoint a business-friendly cabinet and implement a series of major fiscal, political and regulatory policy measures. President Macri lifted foreign exchange controls that had been in place since 2011, and abolished export taxes on many agricultural and industrial goods, including lithium. At the Davos World Economic Forum, Macri and his cabinet members met with almost 20 world leaders, politicians, and multinational executives, which marked a “new era of bilateral relations.” US President Barack Obama will visit Argentina to meet with Mr. Macri at the end of this month.
Minera Exar S.A. President Franco Mignacco commented, “We have recently spent considerable time with the new government officials in provincial and federal mining positions, as well as the new appointments at our local partner JEMSE. Like many others, we are impressed with the rate of positive change and commitment of strong support on all levels. These are important indications of a very strong future for the mining industry in Argentina that will positively benefit all of our stakeholders and communities.”
Update on Hectatone Inc.:
The Company is pleased to report that it is in discussions with several parties that could result in new global distribution agreements outside of the North American oilfield market. Mutual due diligence and product testing is on-going. Hectatone Inc. (“Hectatone”) shipped 140 tons of finished product in February and has additional orders to ship in March. Drilling activity in almost all energy markets continues to decline. However, there are recent and encouraging signs that many global energy markets are beginning to stabilize.
Hectatone President Frank B. Wright, Jr. commented, “This is a productive and creative period for the Hectatone business. The opportunity to collaborate with strategic partners on a global basis in diverse markets is encouraging. The Hectatone team has responded to the declining oilfield market with innovative product development for industrial and environment markets. Additionally, we are seeking to take advantage of the downturn by expanding our talented team. I remain confident that our objective of becoming cash flow positive by year-end is a realistic and achievable goal, and that we will emerge from the bottom of the cycle as a stronger company.”
Update on Lithium Nevada Corp.:
The Company is completing the pilot plant programs at its demonstration plant in Germany. This work has greatly increased the Company’s understanding of the processing and engineering requirements for the production of lithium products from the Lithium Nevada Project. In light of the recent results, the Company has determined that additional specific engineering work will be required to optimize the front end of the process to produce a clean and concentrated lithium brine on a commercial scale. In addition, the Company has become aware of recent technological advancements in producing lithium compounds from brines, and believes these innovative and sustainable technologies warrant further review for potential incorporation into the Nevada processing plant design.
As a result of these additional reviews, the Company has initiated the preparation of a new preliminary Feasibility Study. The new report will include a thorough analysis of project development and operational components, include processing infrastructure, production rate, and supporting inputs, as well as capital and operating expenditures. In the meantime, the Company has determined that its pre-feasibility study completed in March 2012 is no longer current and the Company will no longer be relying on the study for its project development planning. There are no changes to the lithium resource base on the project. While the updated studies are underway, Lithium Nevada will pursue strategic partnership opportunities to advance the project on a timely basis.
Lithium Americas CEO Tom Hodgson commented, “Extracting lithium from clays at a commercial scale level requires vision, capital, and talent. We are always in the process of trying to determine the optimal path to advance our projects to achieve long-term success, and we are excited with a new focus from the team at Lithium Nevada Corp. In today’s strong lithium market, there is no question that LNC’s resource in Nevada represents tremendous long-term value. The Lithium Nevada Project hosts one of the largest lithium resources in North America. There is strong local and national support from both commercial and political bases to advance a Nevada based project. A clear and well-defined permitting path exists. Lithium Americas shares the vision of making Nevada a center of renewable energy and sustainable mining technologies. We are absolutely committed to advancing Lithium Nevada Corp. on the fastest timetable possible, as dictated by further studies and market conditions.”
Update on Management and Board of Directors:
Lithium Americas is pleased to announce that the Company’s Vice Chairman, John Kanellitsas, is being named President, effective as of the Company’s Annual General Meeting (“AGM”) on March 30th. Current President, Jay Chmelauskas will be leaving the Company in order to pursue other interests. In this context, Mr. Chmelauskas has withdrawn his name as a director nominee at the AGM.
John Macken, Chairman of the Board commented “We thank Jay for his service to the Company over many years, and his efforts in initiating the merger of the two companies. We wish him every success in his future endeavours. Following the merger of Western Lithium and Lithium Americas in September 2015, the combined company has emerged with strong and capable management, and an exciting future.”
Click here for the full press release.
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Nevada Energy Metals (TSXV:BFF) (OTC Pink:SSLMF) announced the staking of 86 placer claims (approximately 1720 acres) in the San Emidio Desert, Washoe County, Nevada, 95 km northeast of Reno, the home of Tesla Corporation’s new lithium-ion battery “Giga Factory”.
As quoted in the press release:
The San Emidio Desert basin is an alkali playa environment underlain by unconsolidated sediments and clays being fed by lithium bearing geothermal fluids (US. Geothermal analyses) reported in bounding faults, and/or faults along the east side of the basin. Since mid-Tertiary, the rocks on the eastern edge of the San Emidio Desert have undergone extensive hydrothermal alteration and the presence of near-surface thermal fluids, suggest that the thermal fluids represent deep circulation of meteoric water (Moore, J.N., 1997).
The property adjoins the Empire geothermal power plant with production of 4.6 MW of electricity from a 155°C resource thereby providing a substantial heat source for the circulation of meteoric groundwater believed important in the formation of lithium brine deposits as found at Clayton Valley, Nevada host to North Americas preeminent lithium brine production. US Geothermal has reported anomalous lithium values in the trace element analysis of their geothermal brines at Empire (USGS-Report 87-4062)
Previous work by other operators exploring the playa have reported lithium value in sediments up to 312 ppm and the average of sampling being in the order of 250 ppm.
Nevada Energy Metals Chairman, Harry Barr, stated:
The company is pleased to report that no royalties, option payments or work expenditures have been incurred as a result of the acquisition of the San Emidio lithium exploration project. Nevada Energy Metals Inc strives to be a leader in the exploration and development of economic Lithium deposits. Our principal activities are in Nevada and our project portfolio is expanding.
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It isn’t everyday that one of the heaviest metals and the lightest metals are found in the same rocks. But for uranium-focused Plateau Uranium (TSXV:PLU), the Macusani deposit has netted just that. In its latest press release, Plateau unveiled a mineral resource estimate for the lithium mineralization found alongside the uranium mineralization at four of the company’s 14 uranium deposits.
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Calculated within the defined uranium resource footprint using a 75 ppm uranium cut-off, the project has an indicated lithium resource of 52.3 million tonnes at 0.13 percent grading, containing 67, 000 tonnes Li2O, and an inferred lithium resource of 87.7 million tonnes at 0.12 percent containing 109,000 tonnes Li2O. According to Plateau, “[b]y-product lithium production has the potential to add value to the Company’s compelling uranium story that already has lowest quartile potential operating costs of $17.28/lb U3O8.” Plateau also noted that the average potassium grade included in the lithium resource estimates is 3.71 percent for the indicated resource and 3.73 percent for the inferred resource.
Speaking to how the combination of the two metals will help the company’s position in Peru, Plateau Uranium CEO Ted O’Connor told Investing News Network that “The Peruvian government understands the Green House Gas emission-free energy that nuclear provides, and is supportive of future uranium production in the country. The proposition of extracting lithium as a by-product only strengthens the global green energy benefits, if the lithium proves to be a solid economic proposition.”
O’Connor believes that the combination of these two green energy metals could attract a new level of interest from potential partners, investors, producers and even end users. The CEO looked, for instance at nuclear utilities, “be they government or private enterprises are actually energy companies with a variety of electrical generating methods in their electricity mix. With increasing amounts of renewables requiring lithium battery technology for storage during low generating periods, these utilities would have an added interest to see such a project developed,” he said.
Plateau has confirmed internal test work on the lithium mineralization which confirms that the it can be successfully leached with sulphuric acid. The company anticipates that the lithium carbonate and potassium sulphate should be the potential products precipitated from the leach solutions using the leaching process, however, more engineering and testing is required in order to truly assess the possible impact to the project economics.
That said, O’Connor explained that Plateau has plans to “complete additional extraction leach tests to improve recoveries and understand the leachable lithium, leach kinetics and optimize leach conditions.’
This work will provide the company with a much clearer idea of the technical inputs required in order to establish the potential operating costs and additional capital requirements in adding a lithium extraction circuit.
“The rock would be mined and processed for uranium already, and adding a lithium extraction circuit to process this material prior to being stored in a tailings facility should add value to the project.”
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Plateau Uranium’s current investor base has no doubt been attracted to the company based on its uranium holdings. Following the company’s January preliminary economic assessment which highlighted a cash operating costs average of US$17.28/lb U3O8 over the life of mine, Plateau has made a name for itself as a uranium junior.
With the addition of lithium to its resource base, investors might wonder if Plateau has plans to shift focus. O’Connor was quick to quell any fears, telling INN that “Plateau Uranium is a uranium company – full stop.”
“Our focus is developing our robust uranium project first and foremost, however, if by-product lithium extraction and production proves to be economic, we need to pursue this further on behalf of our shareholders. I believe investors, regardless of commodity focus will understand, appreciate, and indeed support pursuing lithium to enhance shareholder value.”
Following the news, Plateau Uranium’s share price was up 7.14 percent, to trade at $0.38.
Securities Disclosure: I, Vivien Diniz, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
Plateau Uranium is a client of the Investing News Network. This article is not paid-for content.
The post Plateau Uranium’s Lithium Resource Estimate Adds to Green Energy Metal Portfolio appeared first on Investing News Network.
It’s no secret that most oil stocks have suffered over the past year or so. Though they’ve gained back some ground in recent months, oil prices are still down 7.65 percent year-to-date, and BP (NYSE:BP,LSE:BP) has seen its share price drop roughly 22 percent, to $31.05, over the same period.
Despite these recent events, many investors are still wondering about the BP oil stock price before the company’s 2010 Deepwater Horizon oil spill in the Gulf of Mexico. The spill, considered to be the worst of its kind in US history, released an estimated 3.19 million barrels of oil into the Gulf before the leaking pipe was capped 87 days later. BP agreed to pay $18.7 billion in fines related to the spill in July 2015.
Not surprisingly, the event also coincided with one of the biggest drops for BP’s stock price since 1978. Shares of the company lost 54 percent on the New York Stock Exchange between April 20 and June 25, 2010, bouncing back slightly before the wellhead was capped on July 15, 2010. BP stock lost a similar amount in London over the same period.
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Previously, the company had lost roughly 45 percent of its share price value in New York between May 23, 2008 and October 10, 2008 — that fall came during the global financial crisis.
The selloff in the wake of the Deepwater Horizon spill was also marked by the largest trading volumes in BP’s stock price history by a long shot. Volumes peaked at 735.76 million in New York on June 11 2010, compared with daily averages that sit closer to 30 million. Check out the spike at the bottom right of the BP stock price chart below:
Source: Google Finance
The BP stock price was sitting at roughly $59 prior to the spill, and so far shares of the company haven’t come close to recovering. BP shares have traded within a 52 week average of $27.01 and $43.85, and the BP stock price has been on an overall downtrend for the past year and a half.
Most recently, BP has seen troubles at its Salah gas joint venture in Algeria. The gas plant was reportedly hit by a rocket attack on March 18, and according to the Wall Street Journal, both BHP and joint venture partner Statoil ASA (NYSE:STO) are withdrawing their staff from the country.
BP has thus far left its dividend unchanged despite falling revenues due to low oil prices, but market watchers are divided on expectations for the company’s performance in the near future. Writing for Seeking Alpha, Damon Verial argued that BP stock is doing worse now than it was in 2010, noting that the company hasn’t raised its dividend since August 2014.
“The oil spill was a PR nightmare and did put a dent in the business. But overall, BP was still running and increasing its dividends to shareholders,” Verial writes,” … Even if its stock stabilizes at $30, BP could cut its dividends.”
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Looking ahead, Verial believes that “things will only get worse in 2016,” for BP, noting that “[w]hile the price of oil has bounced back, we see no such bounce in BP.”
However, Barclays (LSE:BARC) is much more positive on BP. According to Interactive Investor, Barclays believes that the company offers more relative upside than Shell (NYSE:RDS.A), and has now set BP as its top pick. The firm isn’t forecasting a turnaround for BP in 2016, but it is expecting things to pick up for the company by 2020.
“[A]dditional cash flow from projects coming on stream combined with the continued effort to reduce the cost base, particularly at the corporate level, should enable BP to maintain and even grow the current dividend level over the coming five years,” Barclays oil analyst Lydia Rainforth was quoted as saying.”As a result, we see the 7.5% yield and 54% potential upside to our 550p per share price target as compelling and we rate the stock ‘overweight’.”
Securities Disclosure: I, Teresa Matich, hold no direct investment interest in any of the companies mentioned in this article.
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Granite Oil (TSX:GXO) reported its 2015 financial results, highlighting an improved balance sheet for the year. The company finished 2015 with $39.6 million of net debt, with a $1.8 million reduction relative to third quarter results. The company also increased its dividend by 17 percent to $0.42.
As quoted in the press release, additional highlights from the year included:
- Improved the balance sheet, exiting 2015 with $39.6 million of net debt, a $1.8 million reduction relative to third quarter results.
- Drilled two horizontal production wells and averaged 3,334 bbl/d of oil production and 3,476 boe/d. Natural gas volumes decreased relative to the Third Quarter of 2015 as the Company continues to increase injection of its produced gas.
- Drilled a vertical test well on the western portion of the Bakken pool, Granite’s final commitment well.
- Granite’s operating netback for the fourth quarter was $22.25 per boe prior to hedge gains, with funds flow of $13.3 million, including hedge gains.
- Achieved operating costs of $5.91 per boe.
- Capital expenditures totaled $8.6 million including $1.7 million for equipment related to the expansion of the EOR scheme.
Click here for the full press release.
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Luke Burgess of Energy and Capital recently published a piece exploring palladium’s connection to the lithium revolution. He argues that hybrid vehicles, which still need palladium for catalytic converters, will gain market share more quickly than purely electric vehicles, meaning that palladium demand could still be set to rise.
As quoted in the publication:
All plug-in hybrid electric vehicles (PHEV), which burn either gasoline or diesel, require catalytic converters.
In other words, PHEVs will require both lithium for their energy storage batteries and palladium or platinum for catalytic converters.
The only cars that don’t require catalytic converters are battery electric vehicles (BEV), which don’t burn any hydrocarbon fuel.
Now, the BEV market is an extremely profitably industry right now. But that’s because BEVs still only hold about 1% of the total global vehicle market share — and that market is growing like wildfire.
However, even the most optimistic outlook on the BEV market doesn’t expect that the global market share for battery electric vehicles will cross 10% until at least 2030.
The majority of the “electric” vehicles are expected to be hybrids — which means the world is still going to need a lot of these babies.
Click here for the full article.
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The Globe and Mail reported that oil prices steadied following an early drop after news of deadly explosions in Brussels on Tuesday.
As quoted in the publication:
Brent was up 24 cents at $41.78 a barrel by 10:53 a.m. EDT (1453 GMT), after hitting a session low of $40.97 earlier.
U.S. crude rose 12 cents to $41.64, recovering from an intraday low of $40.77.
Click here for the full article from the Globe and Mail.
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Liontown Resources (ASX:LTR) has completed its due diligence on the Hang Gong lithium-tantalum property in Australia’s Northern Territory, and will complete the acquisition of the property by paying $75,000 to A & SF Maddalozzo.
As quoted in the press release:
The Hang Gong property comprises two tenements, MLN16 and EMP28651, which will form part of Liontown’s larger, 80km2 Bynoe lithium-tantalum project located ~40km south of Darwin (Figure 1 and 2).
Pegmatites up to 390m long and 60m wide have been defined on Liontown’s project area by previous explorers, including Greenbushes Ltd, targeting tin-tantalum mineralisation which is commonly associated with lithium.
The Company intends to commence drilling at Bynoe in May 2016 subject to normal approvals.
Click here for the full press release.
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The National Science and Engineering Research Council of Canada has awarded jointly a $25,000 research grant to Dajin Resources Corp. (TSXV:DJI,OTCMKTS:DJIFF) and Dr. Pierre Kennepohl, department of chemistry, at the University of British Columbia.
As quoted in the press release:
Dr. Kennepohl, is a renowned specialist in Lithium brine chemistry with considerable experience in researching Lithium brines. The grant will enable Dr. Kennepohl and his colleagues to work with Dajin in the “Characterization and Speciation of Lithium in Heterogeneous Brines: a step towards more efficient and environmentally sustainable Lithium extraction”. In Dajin’s exploration at Teels Marsh, Nevada, they have encountered brine deposits that differ markedly depending on their inherent geochemistry and brine composition.
The team will work towards standardizing sampling protocols and analytical methodologies to consistently report results. They will also work on the most appropriate and efficient extraction methodologies which requires a detailed understanding of the chemical speciation of Lithium deposits in both the solution (brine) and solid (mineral) phases. A major impediment to industry consistent reporting remains accurate and efficient quantification and speciation of Lithium in real mineral and brine samples.
Dr. Kennepohl, noted that he is looking forward to assisting Dajin in advancing their understanding of Lithium brines as well as the industry in better understanding the physical properties of brines. Dajin’s President, Brian Findlay, is pleased to have such a high profile team of researchers shedding light on the complex chemistry of Lithium brines.
Connect with Dajin Resources Corp. (TSXV:DJI,OTCMKTS:DJIFF) to receive an Investor Presentation.
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Nevada Energy Metals (TSXV:BFF) announced the appointment of Mr. J. Malcolm Bell to the Advisory Board and as lead consultant for Project Acquisitions.
As quoted in the press release:
Mr. Bell has over 45 years of resource industry experience either as principal, director, or senior officer of private and public companies. In 1980, he founded Hi-Tec Resource Management Ltd., a successful minerals exploration company providing geological services in Canada, the USA and South America. In 1986, he founded the International Investment and Business Opportunities Exposition, the first investment trade show company in Canada providing private and public companies the opportunity to showcase themselves to an international audience.
In 1997, he co-founded British Canadian Mines Ltd., at the time the largest privately held mineral exploration company in Newfoundland; subsequently completed a $13-million reverse merger into Canaco Resources Ltd. In 2002, he helped negotiate a $20-million merger between Olympic Resources Ltd and Whittier Energy Corp., and in 2003, he co-founded PB Energy Partners, an oil and gas exploration partnership. Currently, Mr. Bell heads a private Vancouver based consultancy that sources projects and capital for companies engaged in mining, renewable energy and technology ventures.
Connect with Nevada Energy Metals (TSXV:BFF) to receive an Investor Presentation.
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Oakridge Global Energy Solutions (OTCMKTS:OGES) announced the opening of its $40 million, 70,000-square-foot state-of-the-art manufacturing facility in Palm Bay, Florida. This new facility will immediately begin full commercial production fulfilling orders.
As quoted in the press release:
This marks the completion of the Company’s transition–begun in July 2014 and continued through December 2015–from a primarily Research & Development company to a full-fledged battery manufacturing company. With over $40 million invested in research and product development since mid 2013 the opening and operation of the manufacturing facility confirms the commercial viability of Oakridge’s innovations and represents the most significant step forward in the Company’s history.
Oakridge Global Energy CEO, Steve Barber, stated:
We started 2016 with full commercial production and customer focus. We are excited to announce that we have now begun regularly shipping our groundbreaking lithium-ion batteries to the golf cart and motorcycle markets, as well as a number of significant custom and semi-custom markets. This signifies the first time Oakridge is on permanent, routine commercial production footing,” Barber continued. “With the domestic US market representing over 35% of global demand, we are uniquely capable of leveraging our position as the only domestic manufacturer of lithium-ion batteries
Connect with Oakridge Global Energy Solutions (OTCMKTS:OGES) to receive an Investor Presentation.
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Reuters reported that oil prices gained on Monday after data showed a drop in crude stockpiles at the Cushing, Oklahoma delivery hub.
As quoted in the publication:
Brent crude futures for May delivery, the front-month, were up 10 cents at $41.30 a barrel by 12:35 p.m. EDT (1635 GMT). Brent has risen 52 percent from 12-year lows of $27.10 hit on Jan. 20.
U.S. crude futures for April, which expire as the front-month at Monday’s settlement, gained 71 cents to $40.15. U.S. crude’s more-active May contract, which would be front-month from Tuesday, rose 26 cents to $41.40.
Crude stockpiles in Cushing fell 570,574 barrels to 69.05 million in the week to March 18, traders said, citing data from market intelligence firm Genscape. Cushing inventories had previously risen toward 70 million barrels, causing market participants to fear they could hit capacity.
Click here for the full article.
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Ultra Lithium Inc. (TSXV:ULI) announce that it intends to complete a non-brokered private placement of up to 5,000,000 units of the Company at a price of $0.10 per Unit for aggregate proceeds of up to CDN$500,000.
As quoted in the press release:
Each Unit will be comprised of one common share and one common share purchase warrant (“Warrant”). Each Warrant will entitle the holder to purchase an additional common share of the Company at an exercise price of $0.20 per share for a period of one year from closing of the private placement provided that if the closing price of the common shares of the Company on any stock exchange or quotation system on which the common shares are then listed or quoted is equal to or greater than Cdn $0.40 for a period of ten (10) consecutive trading days, the Company will have the right to accelerate the expiry of the warrants by giving notice to the holders of the warrants that the warrants will expire at 4:30 p.m. (Vancouver time) on a date that is not less than ten (10) business days from the date notice is given.
The proceeds from the Private Placement will be used to fund the exploration of the Company’s South Big Smoky Valley property and for general working capital purposes.
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