Announces Non-brokered Private Placement of up
to $5,000,000
VANCOUVER, BC, Nov. 24,
2023 /CNW/ - Pacific Arc Resources Ltd. (NEX: PAV.H)
("Pacific Arc" or the "Company") announces that that it has entered
into two Letters of Intent ("LOI's") dated November 13, 2023 which contemplate the Company
completing a change of business to an oil and gas issuer (the
"Transaction"). One with Greenflame Resources Inc
("GRI"), whereby Pacific Arc will advance US$2,000,000 to acquire a direct 20% equity
interest in the Production Sharing Contract ("PSC") held by
GRI and New Horizons energy on the Parrylands Block E in
Trinidad and Tobago. The PSC
covers 744 acres within the Parrylands Block, there have been 110
wells drilled previously on the block and it is connected to port
via an existing pipeline. The PSC is subject to a 16% royalty the
license is held by production and is in good standing.
The second LOI is with Kinghorn Operations Inc. ("KHO")
whereby Pacific Arc will earn a 50% interest in an initial 5 well
pilot program to test the Nordegg
formation in certain lands controlled by KHO (the "Farm-in") upon
Pacific Arc paying 100% of the actual costs of the pilot program.
Pacific Arc will initially advance $750,000 to KHO prior to KHO commencing
operations on the 5 well pilot program. It is estimated that the
cost of the pilot project will be approximately $750,000. Upon payment of the $750,000.00 to KHO and upon payment of 100% of
the Farmin costs for the 5 well pilot program PAV will earn a 50%
ownership in the production spacing units in the land containing
the 5 well pilot program. Further, as part of the Farm-in, the
partners shall establish an Area of Mutual Interest "AMI" covering
the Farm-in lands in the Clairmont
Area in the Province of Alberta. As such, Pacific Arc intends to
complete the Farm-in Agreement with KHO and an updated PSC.
The Transaction terms set out in the LOIs are non-binding, and
the Transaction is subject to the parties successfully negotiating
and entering into definitive agreements in respect of the
Transaction
Proposed Private Placement
Pacific Arc intends to complete a non-brokered equity financing
or financings for aggregate gross proceeds of $5,000,000 of units priced at a minimum price of
$0.25. Each unit shall comprise one
full common share and a 1/2 warrant, with each full warrant
exercisable into a common share for 18 months from the closing of
the financing at an exercise price of $0.40 per share. The use of proceeds will be to
cover the above-mentioned transactions and provide general working
capital as it seeks other opportunities within the sector.
Finders' fees may be payable in connection with the Offering in
accordance with applicable securities laws and the policies of the
TSX Venture Exchange ("TSXV").
About Pacific Arc Resources Inc.
Pacific Arc is a reporting issuer in the Provinces of
British Columbia, Alberta, and Ontario incorporated under the BCBCA. The
common shares of PAV are listed for trading on the TSXV NEX board
under the symbol "PAV.H" .
About Greenflame Resources Inc
Greenflame Resources Inc is a private company incorporated under
the Business Corporations Act (Alberta) (the "ABCA"), whose primary business
is oil and gas exploration and development, principally via its
holdings in Trinidad and Tobago
via a Production Sharing Contract in partnership with New Horizons
Energy. The Production Sharing Contract covers the " Parrylands
Block E" project.
A Netherland Sewell and
Associates Inc report dated December 31,
2022 estimates 1P reserves at 3.20MMBBL,2P reserves at
9.75MMBBLS and 3P reserves at 19.50MMBBLS, these reserves are for
the 100% interest in the Production Sharing Contract for the
Parrylands Block E project. The parties to the PSC intend to begin
a multi phase EOR program to test and begin production in early
2024. The PSC covers 744 acres within the Parrylands Block E, there
have been 110 wells drilled previously on the block and it is
connected to port via an existing pipeline. The PSC is subject to a
16% royalty the license is held by production and is in good
standing.
About Kinghorn Operations Inc
Kinghorn Operations Inc is a private company incorporated under
the Business Corporations Act (Alberta) (the "ABCA") Kinghorn is an
Operator in the Province of Alberta. Licensed by the Alberta Energy
Regulator. ("AER").
Currently Kinghorn has operations in the Clair field
located near Grand Prairie Alberta. Kinghorn is the Operator of
approximately 21 wells in the Clair field covering approximately 4
sections of lands. Kinghorn has a $1.2
million dollar cash bond with the AER. The wells in the
Clair field are all suspended Halfway oil producers with certain of
the wells that can be optimized and re-completed in the Halfway, as
stripper wells or completed for new oil and gas production in the
Upper Halfway formation. The current focus for the Clair field is
that approximately 10 of the wells have interpreted bypassed oil
pay in the uphole Nordegg
formation
Information Concerning the Proposed Transaction
Trading in Pacific Arc shares will remain halted pending the
completion of the Transaction. Pacific Arc will provide further
details in respect of the Transaction in due course by way of press
release.
The Company does not intend to seek shareholder approval of the
Transaction, as the Transaction is not a related party transaction
within the meaning of MI 61-101 or the policies of the TSX-V and no
other circumstances exist which may compromise the independence of
the Company. The Company is a NEX-listed issuer without
active operations; the Company is not and will not be subject to a
cease trade order and will not otherwise be suspended from trading
on completion of the Transaction; and shareholder approval of any
aspect of the Transaction is not required under applicable
corporate laws or securities laws.
Sponsorship
The Company also intends to apply for a waiver from the
requirement to obtain a Sponsor for the Transaction, however, there
can be no assurance that a waiver will be obtained. If a waiver
from the sponsorship requirement is not obtained, a sponsor will be
identified at a later date. An agreement to act as sponsor in
respect of the Transaction should not be construed as any assurance
with respect to the merits of the Transaction or the likelihood of
its completion.
Completion of the Transaction is subject to a number of
conditions, including but not limited to, TSXV acceptance and if
applicable, disinterested shareholder approval. Where applicable,
the Transaction cannot close until the required shareholder
approval is obtained. There can be no assurance that the
Transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the
management information circular or filing statement to be prepared
in connection with the Transaction, any information released or
received with respect to the Transaction may not be accurate or
complete and should not be relied upon. Trading in the securities
of Pacific Arc should be considered highly speculative.
The TSX Venture Exchange Inc. has in no way passed upon the
merits of the proposed Transaction and neither approved nor
disapproved the contents of this news release.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
This news release does not constitute an offer to sell and is
not a solicitation of an offer to buy any securities in
the United States. The securities
of the Company and B.C. Ltd. have not been and will not be
registered under the United States Securities Act of 1933, as
amended (the "U.S. Securities Act") or any state securities laws
and may not be offered or sold within the
United States or to U.S. Persons unless registered under the
U.S. Securities Act and applicable state securities laws unless
pursuant to an exemption from such registration.
Cautionary Note Regarding Forward Looking Statements
This news release contains certain forward-looking statements,
Any statements that express or involve discussions with respect to
predictions, expectations, beliefs, plans, projections, objectives,
assumptions or future events or performance (often, but not always,
using words or phrases such as "expects" or does not expect", "is
expected", anticipates" or "does not anticipate" "plans",
"estimates" or "intends" or stating that certain actions, events or
results " may", "could", "would", "might" or "will" be taken, occur
or be achieved) are not statements of historical fact and may be
"forward-looking statements". Forward-looking statements are
subject to a variety of risks and uncertainties which could cause
actual events or results to materially differ from those reflected
in the forward-looking statements. These risks and
uncertainties include, but are not limited to: the financial
markets generally, the results of the due diligence investigations
to be conducted by the Company, the ability of the Company to
complete the Transaction or the Offering or obtain requisite TSXV
acceptance and, if applicable, shareholder approvals. There can be
no assurance that forward-looking statement will prove to be
accurate, and actual results and future events could differ
materially from those anticipate in such statements. The Company
undertakes no obligation to update forward-looking statements if
circumstances or management's estimates or opinions should change
except as required by applicable securities laws. The reader is
cautioned not to place undue reliance on forward-looking
statements.
SOURCE Pacific Arc Resources Ltd.