With us today is Frank C. Smeenk President & Chief Executive Officer of KWG Resources Inc. Mr. Smeenk discusses recent conversation with Noront Resources after proposed acquisition of Cliffs Chromite was announced.
CALGARY, ALBERTA (Marketwire – Dec 22, 2010) – Niko Resources Ltd. ("Niko") (TSX: NKO) announced today that it has reached an agreement with Sonde Resources Corp. ("Sonde"), under which Niko will acquire Sonde’s 25% interest in Block 5(c), located 94 kilometers off the east coast of Trinidad. The transaction is to be satisfied at closing via US $75.5 million in cash, and the assumption of Sonde's liability under the performance guarantee provided for their Block MG license.
The agreement is subject to the satisfaction of certain conditions including waiver of rights of first refusal and approval from the Ministry of Energy and Energy Affairs for Trinidad and Tobago. Closing is expected to occur on February 28, 2011, subject to extension to facilitate obtaining all required approvals. Niko has agreed to pay a secured refundable deposit of USD $20 million to Sonde upon receipt of a waiver of the rights of first refusal in respect of Block 5(c).
Each of the three wells drilled to date on Block 5(c) have encountered hydrocarbons and have been successfully tested. Niko is pleased to have the opportunity to expand in Trinidad and Tobago, a core area for the company.