Bolivar Energy Corp. (TSXV:BVR)
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CALGARY, Jan. 25 /CNW/ --
/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINTATION IN THE UNITED STATES/
CALGARY, Jan. 25 /CNW/ - Bolivar Energy Corp. ("Bolivar" or the "Company") is pleased to announce that it has entered into a purchase agreement
with Pacific Rubiales Energy Corp. ("Pacific Rubiales") whereby Bolivar
will purchase Pacific Rubiales' 32.5% interest in and operatorship of
the Arrendajo Block in the Llanos Basin, Colombia. Final approval of
the arrangement is subject to regulatory approval by the Agencia
Nacional de Hidrocarburos ("ANH") and by partners in the Block.
For the purchase of the 32.5% operating interest in the Arrendajo Block,
Bolivar will pay US$6.5 million cash in addition to reimbursing Pacific
Rubiales approximately US$3.44 million for its share of phase 5 and 6
costs already incurred. Going forward, Bolivar will assume any future
costs in its 32.5% pro-rata participating interest for the combined
phases 5 and 6 of the Exploration and Production Contract.
John Moreland, President and CEO of Bolivar states: "Bolivar is very
excited at the prospect of assuming a material ownership stake in the
Arrendajo Block. We are encouraged by the technical merit and potential
of the Block and look forward to near-term news flow from the expected
Q1/2011 drilling of a well. We are pleased to have concluded this
initial deal with Pacific Rubiales and look forward to a long and
prosperous relationship with them in the future."
Work on the Arrendajo Block is currently ongoing, with three separate 3D
seismic acquisition programs in progress. The partners in the Block
intend to commence the drilling of a well on the Arrendajo Block in
Q1/2011.
The Arrendajo Block comprises 31,606 gross hectares (10,272 net) and
offers multi-zone stacked potential. The Block is located close to
numerous producing fields in the Central Llanos Basin which include:
Las Abejas, Chaparrito, Los Toros, Palmarito, Sirenas, Corocora and
Dorotea.
The Offering:
Bolivar is also pleased to announce that it has entered into an
agreement with Raymond James Ltd. and Haywood Securities Inc. as
co-lead underwriters and including Paradigm Capital Inc. (collectively,
the "Underwriters"), for the sale of 70,588,300 units of the Company
(the "Units"), on a bought deal basis, at a price of $0.17 per Unit for
gross proceeds of $12,000,011 (the "Offering"). Each Unit shall consist
of one common share of the Company (the "Common Shares") and one-half
of one Common Share purchase warrant of the Company (each whole
warrant, a "Warrant"). Each Warrant will be exercisable for one
additional Common Share at a price of $0.25, subject to adjustment, for
a period of 24 months from the Closing Date (as defined below).
In addition, the Underwriters shall have the option to purchase up to an
additional 15% of the Units issued, exercisable in whole or in part at
any time up to 48 hours prior to the Closing Date, at the same price
and terms as the Offering for additional gross proceeds of up to
$1,800,002.
The net proceeds from the Offering will be used to fund the exploration
and development of the Company's petroleum assets in Colombia and for
general business development, acquisitions, and working capital
purposes.
The Units will be offered by way of private placement to accredited
investors under applicable securities laws in the Provinces of Quebec,
Ontario, Alberta, Saskatchewan and British Columbia and such other
jurisdictions in Canada as the Co-lead Underwriters and the Corporation
may agree.
The Offering is scheduled to close on or about February 15, 2011 (the
"Closing Date") and is subject to certain conditions including, but not
limited to, the receipt of all necessary approvals including the
approval of the TSX Venture Exchange and the securities regulatory
authorities.
This news release does not constitute an offer to sell or a solicitation
of an offer to buy any of the securities in the United States. The
securities have not been and will not be registered under the United
States Securities Act of 1933, as amended (the "1933 Act"), or any
state securities laws and may not be offered or sold within the United
States or to, or for the account or benefit of U.S. persons (as defined
in Regulation S under the 1933 Act) absent such registration or an
applicable exemption from such registration requirements.
About Bolivar Energy Corp.
Bolivar Energy Corp. is an early stage exploration company active in the Llanos Basin in Colombia, and trading on the TSX Venture Exchange
under the symbol "BVR".
Forward-Looking Statement
This news release includes forward-looking statements related to the
expected occurrences in relation to the properties identified. A
multitude of factors can cause actual events to differ significantly
from any anticipated development and although the Company believes that
the expectations represented by such a forward-looking statement are
reasonable; there can be no assurance that such expectations will be
realized. These forward looking statements are based upon assumptions
that the Company has made concerning the oil and gas industry in
Colombia, the reliability of available data regarding the properties,
and the continuing market for oil and gas. Risk factors may include
the uncertainty of conducting operations under a foreign regime, the
availability of labour and equipment, the fluctuating price of oil and
gas, and the Company's dependence upon other participants in the
property areas. Neither the Company nor any of its subsidiaries nor
any of its officers or employees guarantees that the assumptions
underlying such forward-looking statements are free from errors, nor do
any of the foregoing accept any responsibility for the future accuracy
of the opinions expressed in this document or the actual occurrence of
the forecasted developments.
To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/January2011/25/c4994.html
p/p tabletr valign="top"td align="left"Bolivar Energy Corp.br/ John Morelandbr/ President and Chief Executive Officerbr/ Telephone: (403) 802 0770 a href="mailto:john.moreland@bolivarenergycorp.com"john.moreland@bolivarenergycorp.com/a/td td align="left"Bolivar Energy Corp.br/ Peter Argirisbr/ Chief Financial Officerbr/ Telephone: (403) 802 0770 a href="mailto:peter.argiris@bolivarenergycorp.com"peter.argiris@bolivarenergycorp.com/a/td/tr/table