Ryland Oil Provides Corporate Update and Announces Debt Financing
10 Novembro 2009 - 11:00AM
Marketwired
Ryland Oil Corporation (TSX VENTURE: RYD) ("Ryland" or "the
Company") is pleased to provide an update concerning its
exploration activities with its joint venture partner, TriAxon
Resources Ltd. (which announced yesterday that it has entered into
an agreement under which it will be acquired by Crescent Point
Energy Ltd).
Ryland's exploration focus continues to be on the Bakken
Formation in its 81 sections in the Flat Lake area of Southeast
Saskatchewan which it has joint ventured with TriAxon. The
stimulated horizontal well drilled by TriAxon was put on pump in
August, 2009, and its managed production rate of 200 barrels of oil
per day announced in September has increased to a current
production rate of approximately 250 barrels of oil per day. This
was the third earning well drilled by TriAxon under the joint
venture, with TriAxon paying 100% of the costs to drill, complete
and equip the well to earn a 50% working interest in a portion of
Ryland's surrounding acreage. TriAxon has recently successfully
drilled a fourth earning horizontal well located approximately 4
miles northeast of the 1-22-1-14W2 well, and is preparing the well
for fracture stimulation. In September TriAxon formally notified
Ryland that it has elected to drill the next option well,
approximately 5 miles west of the 1-22 well. TriAxon has indicated
that it is considering spudding the well before year-end. TriAxon
may elect to drill a total of 7 earning wells to fully earn in to
its rights for the Bakken Formation across the Company's extensive
Flat lake acreage position.
Ryland also announces that it is proceeding with a syndicated
loan of up to CDN$8 million, which will be used to pay outstanding
debt obligations and for general working capital. The loan will be
for a term of one year and bear interest at the rate of 10% per
annum, calculated annually. The loan will repayable as to interest
only quarterly, with the final interest payment plus principal
being due and payable on the first anniversary of the date of
closing; provided that if Ryland enters into any transaction by way
of merger, amalgamation or plan of arrangement, or is the subject
of a takeover bid, resulting in new shareholders holding more than
50% of Ryland's outstanding shares, the loan plus accrued interest
will become due and payable on completion of that transaction. The
loan will be repayable by the Company at any time prior to the due
date and will be secured by a charge on the assets of Ryland and
its wholly-owned subsidiary, Pebble Petroleum Inc. As an inducement
to grant the loan, Ryland will issue to the lenders voting common
shares of Ryland equal to 20% of the principal amount of the loan
at a deemed price of CDN$0.35 per share. The shares will be subject
to a hold period expiring 4 months and one day after the date of
issuance. The Company may pay finders' fees in connection of the
placement of the loan. The loan is subject to regulatory
approval.
The Company also announces that it is consolidating its
operations in Canada and is in the process of closing its
Littleton, Colorado office. Messrs. Tom Lantz (Chief Operating
Officer), Richard Pershall (Senior Petroleum Engineer) and David
Greene (Senior Petroleum Engineer) are no longer employed by the
Company. The closing of the Littleton, CO office will not affect
the Company's ownership of its U.S. petroleum and natural gas
leases.
Gerald J. Shields, President
Issued and Outstanding: 193,576,106
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.
Contacts: Ryland Oil Corporation Mr. Jim Welykochy
Vice-President Corporate Development 403.861.1242 Website:
www.rylandoil.com
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