20% Farm-Out for US$3.5 Million
posted on Jan 08, 2009 12:16PM
|January 8, 2009|
|Argenta Finalizes Loma El Divisadero 20% Farm-Out for US$3.5 Million|
|TORONTO, ONTARIO--(Marketwire - Jan. 8, 2009) -
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.
Argenta Oil & Gas Inc. ("Argenta") (TSX VENTURE:AZA) is pleased to announce that the Company has finalized its farm-out agreement for a 20% working interest in the Loma El Divisadero property with Unitec Energy, an Argentinean based private company as initially reported in a press release dated July 16, 2008. The terms of the agreement provide for Unitec to pay the Company US$3.5 million, $500,000 of which will be paid in cash and the $3 million balance to be allocated towards the cost to drill two wells. Once this is completed, Unitec will have an option to acquire an additional 30% working interest and the operation of the Loma El Divisadero property by investing an additional US$3.3 million in additional wells and development costs. Unitec will also pay Argenta production bonuses calculated on cumulative gross production target commencing at US$1.1 million when 4.4 million barrels of oil equivalent production has been achieved, and up to a total of US$7.5 million when an additional 4.0 million barrels of oil equivalent production has been achieved, producing a cap at cumulative production of 8.4 million barrels of oil equivalent.
Daniel Gordon, Vice President, Corporate Development stated:
"Unitec is very enthusiastic about the upside potential of the Loma El Divisadero Block. The farm-out sets an estimated value for the Loma Block of approximately US$17.5 million. Spudding of the first well is anticipated in late February and in the interim, the Company will commence preparatory site work and materials acquisition."
Claudio Larotonda, President stated:
"This is a very significant step in the development of Argenta's assets, allowing us to prove the concept of the Loma field and providing the resources to develop production with no initial cash outlay by Argenta. The partnership with Unitec, part of the Eurnekian Group, adds significant strength to Argenta's ongoing activities in Argentina."
Unitec Energy, based in Buenos Aires, Argentina is part of the Eurnekian Group, a very large Argentine investment company with interests in various industries, including Bioenergy, Media, Airport and Highway Concessions, Tourism, Construction and Beverages amongst others.
In other news, Argenta is pleased to announce the appointment of Andres Tinajero as Chief Financial Officer of the Company. Andres possesses 15 years of business experience in corporate accounting and finance. He has held industry positions for companies ranging from $10 million to more than $3 billion in annual revenues as a CFO and controller. Andres' industry experience includes oil and gas, mining, cement, franchising, not-for-profit, and construction materials. He holds degrees in Business Administration and an MBA, and is also a Member of the Canadian Institute of Certified Management Accountants. Mr. Tinajero will be based in the Company's head office in Toronto, Canada. Mr. Colin Grant has stepped down as interim CFO and will continue as Treasurer of the Company.
Argenta Oil & Gas is a Canadian energy resource company with oil and gas assets in the Neuquen Basin of Argentina and in Colombia's Lower Magdalena Basin. Argenta owns and operates all of its assets. The Company is focusing on low risk development for growth and is currently pursuing a number of opportunities.
For further information on Argenta Oil & Gas, please visit the Company's website at www.argentaoilandgas.com.