Osum Oil Sands Corp. Acquires Orion Oil Sands Project

CALGARY, ALBERTA–(Marketwired – June 10, 2014) – Osum Oil Sands Corp. (“Osum” or the “Company”), a private in-situ oil sands company, today announced that it has entered into an agreement to purchase the Orion Oil Sands Project from Shell Canada (a Royal Dutch Shell Group entity) for Canadian $325 Million (subject to customary purchase price adjustments and certain closing conditions). The transaction is expected to close on or about July 31, 2014.

Commenting on the acquisition, Steve Spence, President and Chief Executive Officer, said: “The Orion Project is a first class operation that will provide Osum with significant current production and cash flow. Our immediate focus is on ensuring a safe and smooth transition of operations. In the longer term we believe that by linking Orion together with our nearby Taiga Project, Osum has a unique opportunity to build a significant production platform in the Cold Lake region.”

In connection with the transaction, Osum has obtained financing commitments from Barclays Bank PLC and Goldman Sachs Lending Partners LLC for Senior Secured Credit Facilities totaling US$225 million. The balance of the purchase will be funded from cash on hand as well as from existing shareholders.

Acquisition Highlights:

• The Orion Project is located in the Cold Lake oil sands region, in close proximity to numerous major oil sands developments. It is approximately 18 kilometers SW of Osum’s Taiga Project, which has received regulatory approval for the construction and operation of a 35,000 barrel per day facility.
• The Project has been producing commercially since 2007 using the well-established Steam Assisted Gravity Drainage (SAGD) thermal heavy oil recovery technology.
• First quarter production averaged approximately 6,700 barrels per day of bitumen from 22 well pairs. At forecast production rates, the Project is expected to have an economic life in excess of 25 years.
• Osum will have 100% working interest and operatorship of the project.

About Osum

Established in Alberta in 2005, Osum Oil Sands Corp. is a private oil sands producer focused on the responsible application of in-situ recovery technologies within Canada’s oil sands and carbonates. Additional information on the Company is available at www.osumcorp.com.

[expand title=”Advisories & Contact”]Cautionary Information and Forward Looking Statements

Certain statements contained in this press release may contain projections and “forward-looking statements” within the meaning of that phrase under Canadian and U.S. securities laws. When used in this document, the words “may”, “would”, “could”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” and similar expressions may be used to identify forward-looking statements. Those statements reflect management’s current views with respect to future events or conditions, including the closing date of the acquisition with Shell Canada, expected cash flows, expected production levels, and expected economic life of the Orion Oil Sands Project, financial position, predictions of future actions or plans or strategies.

Certain material factors and assumptions were applied in drawing conclusions and making forward-looking statements. By their nature, those statements reflect management’s current views, beliefs and assumptions and are subject to certain risks, uncertainties, known and unknown, and assumptions, including, without limitation, assumptions about the closing date of the acquisition with Shell Canada, expected cash flows, expected production levels, and expected economic life of the Orion Oil Sands Project,production delays, changing environmental and other regulations, the ability to attract and retain business partners, the ability to exploit hydrocarbon resources with available technology, the need to obtain and maintain proprietary rights over aspects of the technology, competition from other technologies, the ability to access the capital required for project development, research, technology development, operations and marketing, changes in energy prices and currency levels.

Many factors could cause actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by these forward-looking statements. Should one or more of these risks or uncertainties materialize, or should the assumptions underlying the projections or forward-looking statements prove incorrect, actual results may vary materially from those described in this press release as intended, planned, anticipated, believed, estimated, or expected. Osum does not intend and does not assume any obligation to update these forward-looking statements whether as a result of new information, plans, events or otherwise.

The Company’s securities are not traded on any stock exchange and thus, Osum is not subject to regulation by any Canadian stock exchange. Osum is not a reporting issuer in Canada and its securities are not registered under the United States Securities Act of 1933. As a result, the Company is not presently subject to the reporting, certification or other requirements imposed on Canadian Reporting Issuers or U.S. registered issuers under, among other things, applicable Canadian securities legislation or the U.S. Sarbanes-Oxley Act of 2002 (“SOX”).

This release is provided for information purposes only and shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the common shares in any jurisdiction (including the United States) in which such offer, solicitation or sale would be unlawful.

Inquiries:
Osum Oil Sands Corp.
Justin Robinson
Manager, Communications
jrobinson@osumcorp.com
www.osumcorp.com