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Trading BKP: PFC acquires all of Texalta

Discussion in 'Shares' started by wdongli, 23rd Mar, 2011.

  1. wdongli

    wdongli Well-Known Member

    31st Mar, 2010

    PFC announced:

    1. an Arrangement Agreement dated March 21, 2011 to complete a business combination pursuant to which PetroFrontier will acquire all of the outstanding shares of Texalta.

    2. Each Texalta shareholder shall be entitled to receive

    (i) C$1.58 cash for each Class A common share of Texalta ("Texalta Share") ;
    (ii) 0.45 of a common share of PetroFrontier for each Texalta Share; or

    (iii) any combination of (i) or (ii) in respect of the Texalta Shares held thereby, subject to no more than an aggregate of C$10,000,000 in cash being paid to Texalta shareholders. ​

    The share component of the consideration represents a 21.4% premium using the five day volume weighted average share prices of PetroFrontier and Texalta and a 10.8% premium based on the closing prices on March 21, 2011.



    1. The Transaction consolidates the ownership of exploration permits EP 103 and EP 104 in Australia's Southern Georgina Basin, which represents one of the last remaining virtually unexplored, hydrocarbon prospective, onshore sedimentary basins in the world. To date, only eighteen wells have been drilled within the entire Southern Georgina Basin, an area covering over 24 million acres. Only seven wells have been drilled to date on EP 103 and 104. Post closing of the Transaction, PetroFrontier will own a 100% working interest in EP 103 and EP 104 (5.7 million net/gross acres) as well as a 75% working interest in EP 127 and EP 128 (5.9 million net acres / 7.9 million gross acres), for a total ownership interest of 11.6 million net acres (85.5% of 13.6 million gross acres) in the Southern Georgina Basin.

    2. In addition to conventional carbonate targets, Ryder Scott Company has prepared a report evaluating PetroFrontier's oil and natural gas resources, effective November 1, 2010, (the "Ryder Scott Report"), which estimated that the Lower Arthur Creek "Hot Shale" found in EP 103 and EP 104 contains best estimate un-risked, undiscovered original oil in place of 192 billion barrels and best estimate, un-risked, prospective recoverable oil resources of 18.8 billion barrels. In total, the Ryder Scott Report estimates that EP 103, EP 104, EP 127 and EP 128 contain 27.5 billion barrels of best estimate, un-risked prospective recoverable oil resources.

    3. The Transaction will allow PetroFrontier to accelerate its high impact, light oil exploration program in Australia. PetroFrontier believes that the Southern Georgina Basin petroleum system is geologically analogous to proven unconventional Bakken Shale and conventional carbonate ramp plays in southeast Saskatchewan and North Dakota. PetroFrontier has raised significant funds to date and is well capitalized to execute on its planned 20 well horizontal drilling program. PetroFrontier is preparing to mobilize a drilling rig to the location of its first exploration well, Baldwin-2, on EP 103 and a spud date is expected in the second quarter of 2011. Drilling has been delayed as a result of road bans throughout Queensland caused by significant flooding earlier in the year.

    PetroFrontier Corp. and Texalta Petroleum Ltd. Announce Proposed Business Combination - Yahoo! Finance