/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE
SERVICES OR DISSEMINATION IN THE UNITED
STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY
CONSTITUTE A VIOLATION OF U.S. SECURITIES LAW./
CALGARY, Dec. 20, 2018 /CNW/ - Standard Exploration
Ltd. ("Standard" or the "Corporation") (SDE:
TSXV) is pleased to announce that it has: (i) closed the
previously announced non-brokered private placement of common
shares ("Common Shares") and units ("Units") of the
Corporation, for aggregate gross proceeds of $18,011,000 (the "Private Placement");
(ii) completed the appointment of a new management team (the
"New Management Team") and board of directors (the "New
Board"); and (iii) closed the acquisition by the Corporation of
all of the limited partnership units of Gulf Pine Energy Partners,
LP ("Gulf Pine").
Private Placement
Pursuant to the Private Placement, Standard issued an aggregate
of 254,600,000 Units and 645,950,000 Common Shares for aggregate
gross proceeds of $18,011,000. Each
Unit is comprised of one Common Share and one performance-based
Common Share purchase warrant (each, a "Performance
Warrant"). Each Performance Warrant
entitles the holder to purchase one
Common Share at a price of $0.02 for a period of five years. The
Performance Warrants vest and become exercisable as to
one-third upon the 20-day volume
weighted average trading price of the Common
Shares (the "Market Price") equaling or
exceeding $0.03, an additional
one-third upon the Market Price equaling
or exceeding $0.04 and a final one-third upon
the Market Price equaling or exceeding $0.05.
In addition, in the event the Market Price equals or exceeds
$0.08, each Performance Warrant shall
be exercisable for 1.5 Common Shares, provided that, at the time of
exercise in respect of the additional 0.5 of a Common Share per
Performance Warrant (the "Performance Incentive"), the
Common Shares are listed on the facilities of a recognized stock
exchange (other than the TSX Venture Exchange ("TSXV")), the
Common Shares are acquired for cash or for the securities of a
company listed on a recognized stock exchange (other than the
TSXV).
Pursuant to applicable securities laws, all securities issued
pursuant to the Private Placement will be subject to a hold period
of four months plus one day following the date of issuance of such
securities. Completion of the Private Placement is subject to
certain conditions, including but not limited to, final approval by
the TSXV.
New Management Team and New Board
The Corporation is also pleased to announce that,
contemporaneous with the closing of the Private Placement, the
previously announced appointment of the New Management Team was
completed and the former board of directors and management team of
the Corporation resigned. The New Management Team is led by
Ian Atkinson as President, Chief
Executive Officer and a director, Calvin
Yau, as Vice President, Finance and Chief Financial Officer,
Chris Birchard, Vice President,
Geoscience and Gary McMurren, Vice
President, Engineering. Joining Mr. Atkinson on the New Board are
Bruce Beynon, Michael G. Kohut, Tamara
MacDonald, Andrew McCreath,
C. Neil Smith and R. Steven Smith, with Sony Gill serving as
Corporate Secretary.
The New Management Team has extensive experience in creating
shareholder value on an absolute and per share basis through a
focused full-cycle business plan and believes the current market
environment provides an excellent opportunity to reposition the
Corporation as a high growth junior oil and gas company. The
New Management team believes there is an excellent opportunity to
consolidate high quality, high netback, low decline oil and gas
assets in under-exploited basins in the US Gulf Coast states at
highly attractive metrics. The New Management Team will focus away
from high-priced and infrastructure constrained shale basins in the
US, choosing instead to establish a dominant position in proven oil
and gas basins which attract some of the best commodity pricing in
the US.
Gulf Pine Acquisition
The Corporation is also pleased to announce that it has acquired
all of the issued and outstanding limited partnership units of Gulf
Pine for cash consideration of USD$3,425,000. Gulf Pine is a limited partnership
existing under the laws of the State of
Delaware and a private junior oil and gas exploration,
development and production company formed for the purpose of
acquiring, and subsequently enhancing, producing oil and gas
properties primarily in Alabama
and Mississippi (the "Gulf Pine
Assets").
The Gulf Pine Assets consist of more than 29,000 net acres of
developed land, along with 30,000 net acres of undeveloped land in
Alabama and Mississippi. The corporate production base of
approximately 1,700 boe/d (14% oil) comes from more than two
hundred wells producing mainly from 4 fields in central
Mississippi that exhibit a
combined annual decline of less than 15%. The majority of the
assets are operated and are typified by high working interest
(>90%) utilizing company owned infrastructure with excess
capacity. This will allow the Corporation to control the pace
of development and growth. The New Management Team has
identified a significant infill drilling inventory of stacked pay
locations for both oil and gas opportunities on the held by
production lands that will take advantage of the superior LLS oil
pricing and Henry Hub basis gas pricing in the region. The
producing assets generally exhibit very low recovery factors in
multiple, large oil and gas in place reservoirs which will enable
the New Management Team to use their extensive experience in
horizontal drilling and multistage fracturing to optimize recovery
from the assets.
Completion of the acquisition is subject to certain conditions,
including but not limited to, final approval by the TSXV.
Name Change and Consolidation
The Corporation intends to (i) complete a change of name of the
Corporation from "Standard Exploration Ltd." to "Southern Energy
Corp." (the "Name Change"); and (ii) complete a
consolidation of the Common Shares on the basis of one
post-consolidation Common Share for up to every 5 pre-consolidation
Common Shares (the "Consolidation"). The Name Change and the
Consolidation have each received the approval of the shareholders
and is subject to the approval of the TSXV.
Financial Advisors
Eight Capital and Laurentian Bank acted as financial advisors to
the Corporation in connection with the transactions.
Forward Looking and Cautionary Statements
This news release may include forward-looking statements
including opinions, assumptions, estimates, the Corporation's
assessment of future plans and operations, and, more particularly,
statements concerning the business strategy of the Corporation.
When used in this document, the words "will," "anticipate,"
"believe," "estimate," "expect," "intent," "may," "project,"
"should," and similar expressions are intended to be among the
statements that identify forward-looking statements. The
forward-looking statements are founded on the basis of expectations
and assumptions made by the Corporation which include, but are not
limited to, the timing of the receipt of the required regulatory
approvals and the future operations of, and transactions completed
by the Corporation. Forward-looking statements are subject to a
wide range of risks and uncertainties, and although the Corporation
believes that the expectations represented by such forward-looking
statements are reasonable, there can be no assurance that such
expectations will be realized. Any number of important factors
could cause actual results to differ materially from those in the
forward-looking statements including, but not limited to,
regulatory and third party approvals not being obtained, the
ability to implement corporate strategies, the state of domestic
capital markets, the ability to obtain financing, changes in
general market conditions and other factors more fully described
from time to time in the reports and filings made by the
Corporation with securities regulatory authorities.
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 release.
NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED
STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY
CONSTITUTE A VIOLATION OF U.S. SECURITIES LAWS.
SOURCE Standard Exploration Ltd.