TORONTO, Sept. 27, 2016 /PRNewswire/ - Pacific
Exploration & Production Corp. (the "Company") is
pleased to announced that it has reached an agreement with Karoon
Gas Australia Ltd. (ASX: KAR) ("Karoon") and KAROON
PETRÓLEO & GAS LTDA. (affiliate of Karoon) to sell its 35%
working interest in the following concession agreements in
Brazil S-M-1101, S-M-1102,
S-M-1037, S-M-1165 and S-M 1166 (collectively, the "Karoon
Blocks"). The Company will receive from Karoon U.S.$15.5 million in cash as consideration on closing
for its interests in the Karoon Blocks. In addition, the Company
may receive a subsequent payment of U.S.$ 5
Million on commercial production reaching 1 Million barrels
of oil (or oil equivalents).
"We are pleased to announce this sale, which will improve our
cash position, decrease our exploratory commitments and provide
additional flexibility," commented Dennis
Mills, Chair of the Independent Committee of the Board of
Directors. "This transaction is aligned with the long-term
interests of the Company which is to improve liquidity and best
positions the Company to navigate the current oil price
environment."
The Agreement remains conditional upon, among other things,
approval from the Agência Nacional do Petróleo, Gás Natural e
Biocombustíveis ('ANP') and an approval order from the Superior
Court of Justice in Ontario.
Shareholder Contact Information
Shareholders are reminded that any questions or concerns can be
directed to the Company at ir@pacificcorp.energy.
About Pacific:
Pacific Exploration & Production Corp. is a Canadian
public company and a leading explorer and producer of natural gas
and crude oil, with operations focused in Latin America. The Company has a diversified
portfolio of assets with interests in more than 70 exploration and
production blocks in various countries including Colombia, Peru, Guatemala, Brazil, Guyana and Belize. The Company's strategy is focused on
sustainable growth in production & reserves and cash
generation. Pacific Exploration & Production is committed to
conducting business safely, in a socially and environmentally
responsible manner.
Advisories:
Cautionary Note Concerning Forward-Looking
Statements
This news release contains forward-looking statements. All
statements, other than statements of historical fact, that address
activities, events or developments that the Company believes,
expects or anticipates will or may occur in the future, including,
without limitation, statements regarding the Plan, conditions to
implementation of the Plan, timing of the implementation of the
Plan (including whether the Company will exit from creditor
protection), the value of the Affected Claims, the distribution of
Shares to, among others, Affected Creditors, the Plan Sponsor,
Equity Subscribers and holders of warrants, effect of the Plan on
the Company are forward-looking statements. These forward-looking
statements reflect the current expectations or beliefs of the
Company based on information currently available to the Company.
Forward-looking statements are subject to a number of risks and
uncertainties that may cause the actual results of the Company to
differ materially from those discussed in the forward-looking
statements, and even if such actual results are realized or
substantially realized, there can be no assurance that they will
have the expected consequences to, or effects on, the Company.
Factors that could cause actual results or events to differ
materially from current expectations include, among other things:
the Company's ability to continue as a going concern upon
completion of the Plan; volatility in market prices for oil and
natural gas; a continued depressed oil price environment with a
potential of further decline; default under the Company's credit
facilities and/or the Company's senior notes due to a breach of
covenants therein; amounts becoming due and payable under the
credit facilities and/or the senior notes, notwithstanding the
entering into of support arrangements, whether through the actions
of holders of senior notes or the trustee under the respective
senior note indentures or otherwise; the impact of events of
defaults in respect of the credit facilities and/or senior notes on
other material contracts of the Company, including but not limited
to, cross-defaults resulting in acceleration of amounts payable
thereunder or the termination of such agreements notwithstanding
the protection obtained by the Company under the Companies'
Creditors Arrangement Act proceedings in Canada and/or sought in proceedings under
other applicable jurisdictions (including Colombia and the
United States); failure of the Company to complete the
Creditor/Catalyst Restructuring Transaction, which is
subject to a number of conditions and other risks and
uncertainties; failure to satisfy any terms or conditions of any
other agreement with the Company's creditors on a proposed
restructuring; any negative impact on the Company's current
operations as a result of the Creditor/Catalyst Restructuring
Transaction or failure to implement the Plan or reach any other
agreement with creditors; perceptions of the Company's prospects
and the prospects of the oil and gas industry in Colombia and the other countries where the
Company operates and/or has investments as the result of the
entering into of the Creditor/Catalyst Restructuring Transaction or
otherwise commencing voluntary insolvency proceedings or otherwise;
inability to obtain a listing on a stock exchange acceptable
to the Company, the sponsor of, and certain creditors
supporting, the Plan; the effect of the Creditor/Catalyst
Restructuring Transaction on the Company's business and operations;
political developments in Colombia, Guatemala, Peru, Brazil,
Guyana and Mexico; liabilities inherent in oil and gas
operations; uncertainties associated with estimating oil and
natural gas reserves; competition for, among other things, capital,
acquisitions of reserves, undeveloped lands and skilled personnel;
incorrect assessments of the value of acquisitions and/or past
integration problems; geological, technical, drilling and
processing problems; fluctuations in foreign exchange or interest
rates and stock market volatility; delays in obtaining required
environmental and other licences; uncertainty of estimates of
capital and operating costs, production estimates and estimated
economic return; the possibility that actual circumstances will
differ from estimates and assumptions; uncertainties relating to
the availability and costs of financing needed in the future;
changes in income tax laws or changes in tax laws, accounting
principles and incentive programs relating to the oil and gas
industry; and the other factors discussed under the heading
entitled "Risk Factors" and elsewhere in the Company's AIF dated
March 18, 2016 filed on SEDAR at
www.sedar.com and in the circular dated July 8, 2016 prepared in connection with the
meeting to approve the Plan. Any forward-looking statement speaks
only as of the date on which it is made and, except as may be
required by applicable securities laws, the Company disclaims any
intent or obligation to update any forward-looking statement,
whether as a result of new information, future events or results or
otherwise. Although the Company believes that the assumptions
inherent in the forward-looking statements are reasonable,
forward-looking statements are not guarantees of future performance
and accordingly undue reliance should not be put on such statements
due to the inherent uncertainty therein.
Translation
This news release was prepared in the English language and
subsequently translated into Spanish. In the case of any
differences between the English version and its translated
counterparts, the English document should be treated as the
governing version.
SOURCE Pacific Exploration and Production Corporation