CALGARY, AB, March 25, 2021 /CNW/ - Highwood Oil Company Ltd
(TSXV: HOCL) ("Highwood" or the "Company") is pleased to provide
the below updates.
Operational Update
As previously announced on November 13,
2020, Highwood has closed the divestiture of its Red Earth
assets ("Red Earth") and the related decommissioning liability of
approximately $35 million, for sale
proceeds of $2 million in cash (the
"Red Earth Sale").
The disposition of Red Earth was to Blue Sky Resources Ltd., an
arm's-length Alberta based,
private oil and gas exploration and production company. The
Alberta Energy Regulator has accepted all license transfers
relating to the sale of Red Earth. Highwood has been engaged by the
purchaser to provide transition services relating to the disposed
assets through May 2021. A 1.5%
success fee was paid to National Bank Financial for their role as
financial advisor to the Red Earth Sale.
Highwood's largest source of cashflow continues to be its 200 km
Wabasca Crude Transmission Pipeline in addition to approximately
125 bbls/day of oil production. Pro-forma the Red Earth Sale,
Highwood's current net debt position is approximately $2.5 million on a conforming operating facility
of $10 million, which matures
May 31, 2021.
Acquisition of Over 320,000 Acres of Mineral Permits for
Lithium Evaluation
Highwood is pleased to announce that it has secured permits over
a land position exceeding 320,000 acres throughout Alberta and British
Columbia via Metallic and Industrial Mineral Permits that it
deems to be prospective for lithium extraction. Highwood is
evaluating several potential alternatives with respect to the
assets including bringing in a joint-venture partner and the
purchase or development of a direct lithium extraction
technology. Highwood has retained Echelon Wealth Partners
Inc. as an advisor to assist with determining the best means to
finance the continued development of its broadened investment
mandate.
Since 2017 Highwood and its largest shareholder have been
acquiring lithium rights and evaluating lithium extraction
technologies. The Company is currently awaiting lithium and other
subsurface metal concentrations from produced water test results
and is encouraged by offsetting lithium concentrations and lithium
brine deliverability of related wells.
Should the lithium concentrations meet or exceed expectations,
Highwood plans to conduct a report under the provisions of
National Instrument 43-101- Standards of Disclosure for Mineral
Projects.
Strategic Transformation to an Asset Management
Company
In conjunction with the previously above noted divestitures and
acquisitions, Highwood plans to transition immediately to an asset
management company with a focus on energy, energy transition and
related technologies and rename itself "Highwood Asset Management".
Over the past five years Highwood has been evaluating various
energy, energy transition and cleantech ventures.
The Company has received TSXV acceptance of the Red Earth sale
and intends to seek TSXV and shareholder approval for its proposed
new name change and transition to Highwood Asset Management.
Additional disclosure will be provided once the terms of the change
of business have been finalized.
Oil and Gas Measures
Readers should see the "Selected Technical Terms" in the
Annual Information Form filed on April 30,
2020 for the definition of certain oil and gas
terms.
Warnings
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the Exchange)
accepts responsibility for the adequacy or accuracy of this press
release.
This news release contains forward-looking statements
relating to the future operations of the Company and other
statements that are not historical facts. Forward-looking
statements are often identified by terms such as "anticipate",
"believe", "continue", "could", "estimate", "expect", "forecast",
"intend", "may", "objective", "ongoing", "outlook", "potential",
"project", "plan", "should", "target", "would", "will" or
similar words suggesting future outcomes, events or
performance. These statements involve known and unknown
risks, assumptions, uncertainties and other factors that may cause
actual results or events to differ materially from those
anticipated in such forward-looking statements. Although the
Company believes there is a reasonable basis for the expectations
and assumptions reflected in the forward-looking statements, undue
reliance should not be placed on the forward-looking statements
because the Company can give no assurances that they will prove to
be correct. The forward-looking statements contained in this news
release speak only as of the date hereof and are expressly
qualified by this cautionary statement. Specifically, this news
release contains forward-looking statements relating to, but not
limited to: its transition of an asset management company, and it
lithium assets and future plans related thereto.
All statements other than statements of historical fact,
included in this release, including, without limitation, statements
regarding the future plans and objectives of the Company, are
forward-looking statements that involve risks and uncertainties.
There can be no assurance that such statements will prove to be
accurate and actual results and future events could differ
materially from those anticipated in such statements. Important
factors that could cause actual results to differ materially from
the Company's expectations include risks detailed from time to time
in the filings made by the Company with securities regulatory
authorities.
The reader is cautioned that assumptions used in the
preparation of any forward-looking information may prove to be
incorrect. Events or circumstances may cause actual results to
differ materially from those predicted, as a result of numerous
known and unknown risks, uncertainties, and other factors, many of
which are beyond the control of the Company and certain of may be
found under the heading "Risk Factors" in the Company's AIF.
The reader is cautioned not to place undue reliance on any
forward-looking information. Such information, although considered
reasonable by management at the time of preparation, may prove to
be incorrect and actual results may differ materially from those
anticipated. Forward-looking statements contained in this news
release are expressly qualified by this cautionary statement. The
forward-looking statements contained in this news release are made
as of the date of this news release and the Company will update or
revise publicly any of the included forward-looking statements as
expressly required by Canadian securities law.
SOURCE Highwood Oil Company Ltd.
