NEWS RELEASE | Friday, March 31st, 2017
March 31, 2017 - Nanton, Alberta
Cerus Energy Group (“Cerus”) announces that it has entered into an agreement with a Third Party whereby for the commitment to spend up to ten million five hundred thousand dollars ($10,500,000.00) to drill, frack, test, complete and equip up to seven (7) one-mile long horizontal test wells on one of the operator’s project areas. The drilling program will consist of drilling, fracking, completing and equipping seven (7) one-mile long horizontal test wells on the project lands. This will be “Phase 1” on a project that has identified an additional 27 drilling locations on the project lands. The primary target is medium gravity (21 degree) oil. Drilling is expected to commence immediately after spring break up 2017.
Under the terms of the agreement Cerus will fund through the company’s DFP (Development Finance Platform) 100% of the development cost up to $10,500,000.00 for the costs incurred to drill, frack, test, complete and equip up to seven (7) wells on the project lands. The DFP agreement will entitle Cerus to 80% of the project’s Net Revenue until an undisclosed penalty is recovered from the project.
Post-payout, the DFP agreement will convert from its net profits interest to a non-convertible 5% gross overriding royalty in the Phase 1 wells and their respective drilling spacing units.
Under the terms of the agreement Cerus will have the first right of refusal to fund additional Phases of development drilling on the project lands, on the same terms and conditions as for the Phase 1 drilling program.
About Cerus Energy Group
Cerus Energy Group is a Tier 2 Canadian-based oil and gas exploration company trading on the TSX Venture Exchange with property assets in both Alberta and Saskatchewan.
About Cerus Energy Group's Subsidiary Companies
Texalta Industries Ltd. and Lomac Canada Ltd. are wholly owned subsidiary company's serving various sectors of the oil and gas industry in the Province of Alberta. Maverick Northstar is a private joint venture company between Petrostar Petroleum Corp. of Alberta, Canada and Maverick Synfuels Inc of North Carolina, USA. Maverick Northstar is a chemical processing company focused on improving the value of methane through the production and utilization of methanol in Western Canada located in the province of Alberta. Petrostar holds 60% ownership of Maverick Northstar shares. For further information, please contact:
Mackenzie Loree, CEO
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Certain information in this news release is forward-looking within the meaning of certain securities laws, and is subject to important risks, uncertainties and assumptions. This forward-looking information includes, among other things, information with respect to the Company’s beliefs, plans, expectations, anticipations, estimates and intentions. The words “may”, “could”, “should”, “would”, “suspect”, “outlook”, “believe”, “anticipate”, “estimate”, “expect”, “intend”, “plan”, “target” and similar words and expressions are used to identify forward-looking information. The forward-looking information in this news release describes the Company’s expectations as of the date of this news release. The results or events anticipated or predicted in such forward-looking information may differ materially from actual results or events. Material factors which could cause actual results or events to differ materially from a conclusion, forecast or projection in such forward-looking information include, among others, risks arising from general economic conditions and adverse industry events.
When relying on forward-looking information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. The Company has assumed that the material factors referred to in the previous paragraph will not cause such forward-looking information to differ materially from actual results or events. However, the list of these factors is not exhaustive and is subject to change and there can be no assurance that such assumptions will reflect the actual outcome of such items or factors.
THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS NEWS RELEASE REPRESENTS THE EXPECTATIONS OF THE COMPANY AS OF THE DATE OF THIS NEWS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD-LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER DATE. WHILE THE COMPANY MAY ELECT TO, IT DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION ON AT ANY PARTICULAR TIME.