Forest Gate Corporate Update: Oil & gas deal due diligence still in progress; Sourcing a rig to drill Pershing
February 15 2011 - 9:50AM
PR Newswire (Canada)
MONTREAL, Feb. 15 /CNW/ -- Symbol & exchange: FGE-V MONTREAL,
Feb. 15 /CNW Telbec/ - Forest Gate Energy reports that it is
continuing its due diligence on the acquisition of oil and gas
assets located in south-western Saskatchewan and is currently busy
sourcing a rig to drill its Pershing gold property in Quebec. The
company says it believes that the oil and gas acquisition could
close this week. On the mineral exploration side, Forest Gate
Energy will be undertaking an exploratory drill campaign before
spring break-up and is in the process of sourcing a rig to drill
its Pershing gold property in Quebec. The company has approached
several diamond drill rig suppliers for a quote to undertake the
drilling program on its 100 percent owned Pershing gold property
located near Val D'Or, Quebec. "There is a lot of exploration going
on in Quebec and so it is a tight market for rigs and personnel. We
are presently speaking with a couple companies who have indicated
that they may be able to slot us in between contracts," said Edward
Procyshyn, Manager, Mineral Exploration. With regards to the
company's oil business, Forest Gate is deep into the due diligence
process on its acquisition. As previously announced (FGE news
release, December 23, 2010), upon closing of the transaction,
Forest Gate will own a non-operated 20 percent interest in oil and
gas licenses encompassing 19,848 acres in south-western
Saskatchewan in areas known as Rangeview, Divide and Katherine. The
remaining 80 percent interest is owned and operated by Trafina
Energy Ltd., a publicly-traded oil and gas company based in
Calgary. Subsequent to Forest Gate's December 23 news release,
Trafina Energy reported (see Trafina news release, Jan. 10, 2011)
it had placed its first horizontal well in the Upper Shaunavon
formation into production. Trafina reported that the horizontal
well is producing at a gross oil flow rate of 60 barrels per day.
Prior to the completion of the horizontal hole in the Upper
Shaunavon formation, the Range and Divide properties net production
to Forest Gate would have been 18 barrels oil and 10 barrels of oil
equivalent in gas. The first horizontal well just completed by
Trafina in the Upper Shaunavon will bring net production to Forest
Gate of 30 barrels of oil and 10 barrels of oil equivalent in gas.
Trafina reports that it intends to drill at least two additional
wells in the Upper Shaunavon and at least two wells in the Madison
formation at Rangeview and Divide in 2011. "We have
been working very hard on this deal and for good reason. It
doubles our oil production in the immediate term and has the
low-risk, development potential that could make Forest Gate
cash-flow positive by the end of 2011 or sooner," said Michael
Judson, President and Chief Executive Officer. "It is a significant
building block for the company." About Forest Gate Energy Forest
Gate Energy Inc. is a publicly listed oil and gas exploration and
production, and non-energy resource company trading on the TSX
Venture Exchange under the symbol FGE. The Corporation is seeking
to increase shareholder value through participation and development
of energy and other resources in Canada and internationally.
FORWARD-LOOKING STATEMENTS BOEs may be misleading, particularly if
used in isolation. A BOE conversion ratio of 6 Mcf: 1bbl is based
on an energy equivalency conversion method primarily applicable at
the burner tip and does not represent a value equivalency at the
wellhead. In addition, the estimated values disclosed in this
release do not represent fair market value. Certain statements
regarding Forest Gate, including management's assessments of future
plans and operations and Forest Gate's anticipated financial
performance, may constitute forward-looking statements under
applicable securities laws and necessarily involve known and
unknown risks and uncertainties, most of which are beyond Forest
Gate's control. These risks may cause actual financial and
operating results, performance, levels of activity and achievements
to differ materially from those expressed in, or implied by, such
forward-looking statements. Such factors include, but are not
limited to: the impact of general economic conditions in Canada and
the United States; industry conditions including changes in laws
and regulations including adoption of new environmental laws and
regulations, and changes in how they are interpreted and enforced;
competition; the lack of availability of qualified personnel;
fluctuations in commodity prices; the results of exploration and
development drilling and related activities; imprecision in reserve
estimates; the production and growth potential of Forest Gate's
various assets; fluctuations in foreign exchange or interest rates;
the ability to access sufficient capital from internal and external
sources; and obtaining required approvals of 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 "U.S. Securities Act"), or any state securities laws
and may not be offered or sold within the United States or to
United States Persons unless registered under the U.S. Securities
Act and applicable state securities laws or an exemption from such
registration is available. This news release is not for
distribution to United States newswire services or for
dissemination in the United States. Neither TSX Venture Exchange
nor its Regulation Service Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or the accuracy of this release. To view this news
release in HTML formatting, please use the following URL:
http://www.cnw.ca/en/releases/archive/February2011/15/c2839.html
pROBERT KRAMBERGER, V-P, INVESTOR RELATIONSbr/
1-866-666-3040 br/ ua
href="mailto:rkramberger@forestgate.ca"RKRAMBERGER@FORESTGATE.CA /a/u br/
ua href="http://www.forestgate.ca"WWW.FORESTGATE.CA/a/u/p
Copyright
Forest Gate Energy Inc. (TSXV:FGE)
Historical Stock Chart
From Jun 2024 to Jul 2024
Forest Gate Energy Inc. (TSXV:FGE)
Historical Stock Chart
From Jul 2023 to Jul 2024