(All dollar figures are expressed in United States Dollars, unless otherwise noted)
CALGARY, Dec. 20, 2016 /CNW/ – Madalena Energy Inc. (“Madalena” or the “Company”) (TSXV: MVN and OTCQX: MDLNF) announces that it has sold its CAD $3 million convertible debenture (the “Convertible Debenture”) of Point Loma Resources Ltd. (TSXV: PLX) (“Point Loma”) for cash proceeds of $522,000 (CAD $700,000). The Convertible Debenture was part of the consideration Madalena received when the non-core Canadian assets were sold effective May 1, 2016. The carrying value of the Convertible Debenture at September 30, 2016 was $1.9 million (CAD $2.6 million).
The balance of the consideration Madalena received for its Canadian assets was 6,244,814 common shares of Point Loma, 10% of which are currently free trading. The balance of the shares is escrowed and will be released at six month intervals commencing December 30, 2016. The carrying value of the Point Loma common shares at September 30, 2016 was $1.9 million (CAD $2.5 million).
The Company, as previously disclosed, has been experiencing liquidity challenges. The transaction at Coiron Amago Sur Este, which was announced on December 7, 2016, will, when closed, provide significant assistance to addressing the liquidity and working capital challenges the Company has been facing. Proceeds from the sale of the Convertible Debenture will also assist in this process.
About Madalena Energy
Madalena is an independent, Canadian headquartered, Argentina focused upstream oil and gas company with operations in four provinces of Argentina where it is focused on the delineation of unconventional resources in the Vaca Muerta shale, Lower Agrio shale and Loma Montosa oil plays. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.