Calgary, Alberta (FSCwire) – Point Loma Resources Ltd. (TSX VENTURE: PLX) (the “Corporation” or “Point Loma”) is pleased to announce that it has closed an additional non-core transaction to sell royalty interests acquired as part of a recent east central Alberta transaction and provides an update on its Q4 2018 drilling program activities.
Non-core Asset Dispositions Update
- Point Loma has sold certain royalty interests and a 1% gross overriding royalty on properties acquired in east central Alberta (June 29 press release).
- The sale price of the non-core disposition is $275,000 net to Point Loma, before customary closing adjustments, and has been paid in cash. The effective date of this disposition will be July 1, 2018.
- In combination with a previously announced disposition (September 13 2018) and a smaller transaction completed recently, Point Loma will receive total net proceeds of approximately $673,000.
With a large land position in excess of 160,000 net acres (over 250 net sections), the proceeds from these dispositions and expected additional future non-core asset sales will be directed towards unlocking the Corporation’s Banff oil play, a Rex (Upper Mannville) oil play that was recently captured and its new Lower Mannville oil opportunities. Point Loma also continues to evaluate options to create shareholder value from its Duvernay shale land holdings. The Corporation has no bank debt and is experiencing increasingly positive cashflow from operations.
Fall and Winter Drilling Program – Drilling to Commence Early in Q4 2018
Point Loma is preparing a high impact drilling program targeting oil targets in the Rex (Upper Mannville), Banff and Lower Mannville in its west central Alberta core area. The Corporation currently has one well licensed and is coordinating the survey and licensing activities of additional wells focused on these plays. Point Loma plans to mobilize a drilling rig as soon as possible to drill two of the wells in Q4 2018.
The Corporation believes that its two Banff oil pools that are defined on 3D seismic are analogous to offsetting pools in the Cherhill and St. Anne regions that have original oil in place of up to 90 million barrels and recoveries of up to 40%.
In addition, Point Loma has secured lands on a new Rex (Upper Mannville) oil opportunity analogous to a large oil discovery currently being successfully developed by other operators in the Leduc area. The type wells anticipated in the analogous pool have strong economics in today’s price environment.
Further, Point Loma has identified a new Lower Mannville oil pool south of the Corporation’s existing Paddle River oil development, targeting a thicker pay column than the existing development.
Each of these Banff, Rex and Lower Mannville oil plays have significant upside potential alongside the Corporation’s strategic land position in the Duvernay shale.
“With the funds raised in our ongoing non-core disposition program and proceeds from the current financing, we are well positioned for growth,” said Terry Meek, President and CEO of Point Loma. “We look forward to returning to a drilling program in Q4 2018 that will test two new pool opportunities, either of which could result in a step change in Point Loma’s oil production and return value for shareholders.”
About Point Loma
Point Loma is a public oil and gas exploration and development company focused on conventional and unconventional oil and gas reservoirs in west central Alberta. The Company controls over 160,000 net acres (250 net sections) and has a deep inventory of oil opportunities in the Mannville (upper and lower), Banff, Nordegg, and Duvernay Shale formations. Point Loma’s business plan is to utilize its experience to drill, develop and acquire accretive assets with potential for horizontal multi-stage frac technology and exploit opportunities for secondary recovery. For more information, please visit Point Loma’s website at www.pointloma.ca or Point Loma’s profile on the System for Electronic Document Analysis and Retrieval website at www.sedar.com.