Point Loma Acquires Private Oil and Gas Company

Point Loma Resources (TSXV:PLX) reports that it has entered into a definitive agreement to acquire a private oil and gas company. The purchase price of the acquisition is C$1,557,600.00 and will be paid in the form of 5,192,000 common shares of the corporation.

Calgary-based Point Loma is a public oil and gas exploration and development company focused on oil and gas reservoirs in west central Alberta. The company currently controls over 150,000 net acres and is also exploring opportunities in the Mannville, Nordegg, Banff and Duvernay Shale formations.

As quoted from the press release:

Highlight:

• Point Loma has entered into an agreement to acquire a private oil and gas company with assets focused in East Central Alberta at a deemed share price of C$0.30 per share.
• The acquired production is approximately 130 boe/d, comprised of approximately 30 percent oil and ngl’s.
• The acquisition has estimated working capital at closing of C$310,000.
• Natural gas production is downstream of AECO and receives a premium price to Alberta sales.
• The acquisition has identified opportunities for future oil exploitation and exploration.
• The acquisition’s annualized operating income is estimated at $450,000 to $500,000.
• Included are 15,000 net acres at an average working interest of approximately 40 percent.
• The acquisition has a liability management ratio (“LMR”) of 5.9 in Alberta, comprised of deemed assets of C$2.7 million and deemed liabilities of C$0.5 million.

The acquisition is anticipated to close in June 2018 subject to regulatory approvals. The properties include multiple shallow oil opportunities related to the base production. Point Loma plans to update the acquisition reserves at year end.

“This acquisition increases Point Loma’s production and strengthens our balance sheet. Multi-zone opportunities in the Acquisition include Mannville and Viking oil.” said Terry Meek, President and CEO of Point Loma. “The opportunity to acquire cash generating assets at a competitive valuation continues to add to Point Loma’s reserve base as commodity pricing improves.”

Click here to read the full press release