Oct-14-2010
Press Releases
2010 Press Releases
Crown Point Signs Agreement to Acquire 49.9% Interest in 307,000 Acre Cerro de los Leones Exploration and Production Concession in Argentina’s Neuquen Basin
October 14, 2010
VANCOUVER, BRITISH COLUMBIA, Oct. 14, 2010 (Marketwire) — Crown Point Ventures Ltd. (TSX VENTURE:CWV) (the “Company”) is pleased to announce that it has entered into an agreement to acquire a 49.9% interest in a 307,000 acre exploration and production concession in the Neuquen Basin in the Province of Mendoza. “We have been focused on acquiring an opportunity of this magnitude since 2009,” commented Murray McCartney, CEO. “The exploration and development potential contained in these lands is excellent. To put this in perspective, our interest in the El Valle field in the Golfo San Jorge basin, where we have five producing wells and a strong development drilling inventory, is 15,814 acres. The Neuquen block at 307,000 acres has seven distinct areas of interest with play types ranging from anticlinal features in the deeper western portion to the shallow resource type heavy oil plays on the eastern side. It is an exciting acquisition.”
Crown Point’s interest in the block is being acquired from several private Argentine companies for purchase consideration of approximately CAD$1,000,000 of exploration and development expenses (netapprox.$500,000) to be reimbursed and for the reservation to the vendors of a 2.5% gross overriding royalty (net 1.25% to the CWV interest). The terms of the concession provide for a state royalty of 16% and require the expenditure of CAD$13.85 million (net to CWV – $6.93 million) to be spent on 3-D seismic and drilling over a three year period.
To view accompanying map, please click on the following link: http://media3.marketwire.com/docs/CerroMap.jpg
Cerro de los Leones, as labeled in the map above, is situated in the northern portion of the Neuquen Basin in the Province of Mendoza, and has adjacent producing oil fields operated by YPF, Occidental Petroleum and others. It is jointly being acquired with another Canadian exploration and production company. The joint venture agreement will provide for active roles for both companies in the operation of the joint venture as well as in the management and execution of the exploration and production activities. The two companies are going to jointly execute the operations focusing on the strengths which each company brings to the joint venture.
Mateo Turic, President of Crown Point’s Argentina operations reported on the timeline as follows, “We expect to close this transaction within the next 30 days. After that, our first plans are to obtain the necessary environmental approvals, which should occur by January 2011, shoot a 3-D seismic program in the first half of 2011 and drill the first wells later in 2011.”
Mr. Turic continued, “The block is geologically diverse with seven different exploration plays and prospects. The principal geologic targets are contained in the Lower Tertiary and Cretaceous Periods and focused on the Malargue, Neuquen, Huitrin and Vaca Muerta Formations. Drilling depths on the block are expected to range from 800 metres on the eastern side to 2,500 metres in the South Western portion. In this latter area, we anticipate wells with rates of initial production of 350-500 bbls. of oil per day and reserves per well in excess of 500,000 barrels per well. Pool size estimates are based on nearby analogous fields that indicate we can expect to find unrisked pool sizes ranging from 5-9 million barrels of oil per pool.”
Crown Point continues to evaluate other growth opportunities in Argentina. The successful conclusion of these would continue to add new dimensions to Crown Point in Argentina and expand the depth, breadth and size of our operations and asset base.
About Crown Point
Crown Point Ventures Ltd. is an oil and gas exploration, development and production company with production in Argentina. The Company’s main activities are focused in the onshore Golfo San Jorge and Neuquen Basins in Argentina.
Advisory
This news release contains cert ain forward-looking statements, which are based on numerous assumptions including but limited to (i) drilling success; (ii) production; (iii) future capital expenditures; and (iv) cash flow from operating activities. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect.
The statements in the second paragraph concerning the test production rates from three different zones. Management cautions this is a preliminary measure and could differ from actual production rates when the well is placed on commercial production, and it is expected that the production rates will be impacted by normal field decline rates. Certain other information regarding Crown Point set forth in this document, including management’s assessment of Crown Point’s future plans and operations, number, type and timing of wells to be drilled, the planning and development of certain prospects, production estimates, and expected production growth may constitute forward-looking statements under applicable securities laws and necessarily involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond Crown Point’s control, including without limitation, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, environmental risks, inability to obtain drilling rigs or other services, capital expenditure costs, including drilling, completion and facility costs, unexpected decline rates in wells, wells not performing as expected, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources, the impact of general economic conditions in Canada, Argentina, the United States and overseas, industry conditions, changes in laws and regulations (including the adoption of new environmental laws and regulations) and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in foreign exchange or interest rates, and stock market volatility and market valuations of companies with respect to announced transactions and the final valuations thereof. Readers are cautioned that the foregoing list of factors is not exhaustive. Crown Point’s actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits, including the amount of proceeds, that the Company will derive there from. Readers are cautioned that the foregoing list of factors is not exhaustive. All subsequent forward-looking statements, whether written or oral, attributable to the Company or persons acting on its beh alf are expressly qualified in their entirety by these cautionary statements.
Additional information on these and other factors that could affect Crown Point’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 Crown Point’s website (www.crownpointenergy.com).
The forward-looking statements contained in this document are made as at the date of this news release and Crown Point 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.
BOEs 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.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
Contact:
Crown Point Ventures Ltd.
Murray McCartney
President & CEO
(403) 232-1150
m.mccartney@crownpointenergy.com
Crown Point Ventures Ltd.
Arthur J.G. Madden
Vice-President & CFO
(403) 232-1150
amadden@crownpointenergy.com
Crown Point Ventures Ltd.
Flora Wood
Manager Investor Relations
(416) 304-0032
fwood@crownpointenergy.com
SOURCE: Crown Point Ventures Ltd.
For further information concerning the Company, please contact us directly.