Porto Energy Engages Black Spruce Merchant Capital to provide Financial Advisory Services

    




 THE WOODLANDS, TX, Aug. 24, 2012 /CNW/ - Porto Energy Corp., ("Porto" or the "Company") , a company focused on oil and gas exploration, appraisal  and development in Portugal, today announced the engagement of Black  Spruce Merchant Capital Corporation ("BSMC") to provide financial  advisory services with respect to project and corporate, business  combinations as well as equity and debt financings as part of the  ongoing development on Porto's seven concessions in Portugal's  Lusitanian Basin. 

 Porto is currently actively advancing two of its projects in Portugal.   First, on June 29, 2012 Porto through its wholly owned subsidiary,  announced a definitive farmout with Petróleos de Portugal - Petrogal ("Galp") whereby Galp will pay the Company approximately US$7.8 million to earn  50% of the Company's rights in the Aljuabarrota-3 concession,  comprising approximately 300,000 acres, onshore Portugal.  Under the  terms of the agreement, the Company intends to drill a Presalt well  with a target depth of approximately 3,000 meters.  Drilling is  expected to commence in late August, 2012 and take approximately 45-55  days to complete.  This well has a NI51-101 estimate of 588 BCF P50  gross unrisked resources (294 BCF net P50 unrisked resources).  Second,  on March 1, 2012, Porto announced a definitive agreement with Sorgenia  International B.V., Netherlands ("Sorgenia"), and Rohöl-Aufsuchungs  Aktiengesellschaft, Austria ("RAG"), (together the ("Farm-in  Partners"), to jointly evaluate the unconventional resource potential  of the Lower Jurassic (Lias) stratigraphic interval within Porto's  concessions in Portugal. Porto retains operatorship of the Company's  concessions and the joint venture. With the additions of the two new  concessions in May 2012, Zambujal and Peniche, the area to be jointly  evaluated is approximately 690,000 acres.  The Lias stratigraphic  interval is being pursued as an unconventional resource  throughout Europe. Second phase activities, for which Porto will be  carried for until phase 3, include the drilling of two deep wells and  additional geochemical and geophysical analysis. The costs associated  with the two wells will be shared equally between the Farm-in Partners  capped at a gross cost of US$10.0 million, net of mobilization and  demobilization costs.  Phase 1 of this joint venture is currently  underway with the drilling of 19 wells (9 core wells) of which 11 wells  have been drilled and logged to date both inside and outside the AMI to  determine the outer extent of the Lias interval over the Lusitanian  Basin.  The focus of the first phase, which must be completed  by December 31, 2012, is on developing a comprehensive geophysical and  geochemical analysis of the Lias interval. 

 Porto continues to pursue interests in its other concessions, most  notably its offshore acreage for which the Company has shot and  interpreted approximately 1,100 km(2) of seismic data.  Using this data, the Company has mapped approximately  3 - 4 prospective opportunities. 

 Upon the engagement of BSMC, the Company issued to BSMC 1,000,000  options exercisable at a price of $0.11 per common share for three  years to vest one-third every six months from the date of the  engagement. In addition, BSMC will be paid a monthly work fee during  the term of the engagement, milestone fees in certain circumstances and  a financing success fee on the closing of any debt or equity financing  provided to Porto. 

 About Porto Energy Corp. 

 Porto Energy Corp. is an international oil and gas company engaged in  the exploration of crude oil and natural gas in Portugal, including the  appraisal of a gas discovery.  Through its wholly owned subsidiary,  Mohave Oil And Gas Corporation (a Texas corporation with branch offices  in Portugal), the Company holds working interests in seven concessions  in Portugal's Lusitanian Basin totaling approximately 1.9 million net  acres. Through its exploration efforts to date, the Company has  identified seven major exploration trends over its concessions  including unconventional oil and gas resource plays as well as  conventional oil and gas targets. Porto Energy's shares trade on the  TSX Venture Exchange under the ticker symbol "PEC". For more  information on Porto Energy visit: www.portoenergy.com. 

 About Black Spruce Merchant Capital  

 Black Spruce is a private independent merchant banking company focused  on providing executive level and unbiased financial advisory services  to the global oil and gas industry. Black Spruce's award winning  principals have a history of achieving success for clients based  high-level industry focus, strong industry relationships and innovative  transaction skills. Offering advice in project, corporate and debt  capital markets; equity-linked financings; mergers and acquisitions;  and strategic business development. 

  

 Cautionary Statements 

 No proved, probable or possible reserves have been assigned by the  Company at this time. Undiscovered resources are those quantities of  oil and gas estimated on a given date to be contained in accumulations  yet to be discovered. Estimates of resources always involve  uncertainty, and the degree of uncertainty can vary widely between  accumulations/projects and over the life of a project. There is no  certainty that it will be commercially viable to produce any portion of  the resources. 

 Estimates with respect to resources that may be developed and produced  in the future are often based upon volumetric calculations,  probabilistic methods and upon analogy to similar types of resources,  rather than upon actual production history. Estimates based on these  methods generally are less reliable than those based on actual  production history. Subsequent evaluation of the same resources based  upon production history will result in variations, which may be  material, in the estimated resources. Resource estimates may require  revision based on actual production experience. 

 Prospective resources are those quantities of petroleum estimated, as of  a given date, to be potentially recoverable from undiscovered  accumulations by application of future development projects. 

 Best Estimate is considered to be the best estimate of the quantity that  will actually be recovered. It is equally likely that the actual  remaining quantities recovered will be greater or less than the best  estimate. Using probabilistic methods, there should be at least a 50  percent probability (P50) that the quantities actually recovered will  equal or exceed the best estimate. 

 This press release contains certain forward-looking statements.  These  statements relate to future events or the Company's future  performance.  All statements other than statements of historical fact  are forward-looking statements.  The use of any of the words  "anticipate", "plan", "continue", "estimate", "expect", "may", "will",  "project", "should", "believe", "predict" and "potential" and similar  expressions are intended to identify forward-looking statements.  These  statements involve known and unknown risks, uncertainties and other  factors that may cause actual results or events to differ materially  from those anticipated in such forward-looking statements. No assurance  can be given that these expectations will prove to be correct and such  forward-looking statements should not be unduly relied upon.  These  forward-looking statements are made as of the date of this press  release and the Company does not undertake to update any  forward-looking statements that are contained in this press release,  except in accordance with applicable securities laws. 

 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. 

Porto Energy Corp.


CONTACT:  Porto Energy Corp.Heath Cleaver - Chief Financial OfficerPhone: 1-713-975-1725 Black Spruce Merchant Capital Corp.Sonny Mottahed - CEOPhone: 1-403-351-1779Email: [e-mail] 


    

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