Forent Energy Attracts Significant Investment by W. Brett Wilson
CALGARY, ALBERTA--(Marketwire - March 30, 2010) - Forent Energy Ltd. (TSX VENTURE:FEN) ("Forent" or the "Company") announced today that it has secured Calgary oil and gas veteran and FirstEnergy Capital Corp. co-founder W. Brett Wilson as a major investor and member of the Company's board of directors. Wilson and his associates will provide the majority of funds toward the Company's latest $4 million financing.
The terms of the financing include the issuance of up to 9,090,909 flow-through common shares at a price of $0.22 per share and up to 10,000,000 units of Forent at a price of $0.20 per unit. Each unit will consist of one common share and one-half of one purchase warrant with each whole warrant exercisable into one common share at a purchase price of $0.26 for a period to 24 months from the date of issuance. The placement is subject to TSX Venture Exchange approval and securities issued under the placement will have a hold period of four months and one day from the date of issuance.
The funds will allow Forent to develop its western Canadian assets which will fund the exploration of the Company's Nova Scotia lands, allowing the Company to pursue its long term growth potential in the area.
"It's often difficult for small operators to obtain financing, particularly in frontier oil and gas exploration of onshore Nova Scotia. Brett provides us not only with equity, but with valuable insight into how best to approach the development of our assets to maximize return to shareholders and help establish an onshore petroleum industry for Nova Scotia, which currently is working towards its first onshore production," said Forent Energy President Dennis Forgeron, who grew up in Sydney, Nova Scotia.
The Company's primary Nova Scotia focus is on both the shale gas in the St. Mary's Basin and reef oil plays contained in the Shubenacadie basin, both of which are owned and operated by Forent at a 100% interest and are anticipated to contain substantial commercially viable reserves.
"I'm always looking to invest in smart people who know their industry. I have followed the Forent team for several years. They have a wealth of experience in Canadian exploration and development," said Wilson. "As an investor, I'm optimistic about the return on investment. As a Canadian, I'm optimistic about the impact of an emerging energy industry for the province of Nova Scotia."
In addition to the above, Forent has agreed to purchase all of the shares of Edelex Holdings Ltd., a small partner of Forent in exchange for 327,771 shares of Forent Energy Ltd. at an issue price of $0.25 per share, for an aggregate purchase price of $81,942.75. The assets of Edelex include a 10% working interest and a 10% gross overriding royalty, respectively, in two Forent-operated wells located in northwestern Alberta. Mr. Dennis Forgeron, President of Forent, holds a 7.7% interest in Edelex, consisting of non-voting Class C shares. Otherwise, the acquisition is arm's length and is subject to TSX Venture Exchange approval.
Investors are cautioned that this news release contains forward looking information. Such information is subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in the forward-looking information. Readers are cautioned not to place undue reliance on forward-looking information, as no assurances can be given as to future results, levels of activity or achievements.
Forent Energy Ltd. was originally founded in 1999 as a private oil & gas company focused on low risk projects in central Alberta. After a number of years of successful internal growth the company repositioned itself by assembling an experienced management team to explore large scale frontier blocks. In 2007 Forent farmed in on the 740,000 acre Alton Block in Nova Scotia and in 2008 was awarded an exploration lease for the 460,000 acre Beech Hill Block in Nova Scotia. Substantial oil and gas reserves are expected to exist on both the Alton and Beech Hill blocks, which provide the potential for significant growth of the Company.
Forent's western Canadian operation/asset base is focused primarily in south central Alberta and western Saskatchewan. The Company's low risk future developments are focused primarily on oil developments in these regions, on lands it has acquired in recent land sales and through joint ventures with other operators.
Alton Block - 740,000 acres - Forent has a 100% working interest in the exploration license for the Alton Block. The Maritimes & North East natural gas pipeline that runs through the Alton Block will bring future gas discoveries to market and has spare capacity to deliver to the Maritimes and to the New England States. The Crown applies a 10% flat royalty after an initial 2 year production royalty holiday. Numerous oil and gas shows have been detected throughout the block where the Gays River reefal rocks and Horton organic shales are seen at outcrop. Forent anticipates finding up to 10 Gays River reef drilling targets each with a P-mean Original Oil In Place of 31 MMBBL. Any future oil production can be delivered to refineries located in Dartmouth, Nova Scotia or Saint John, New Brunswick.
Beech Hill Block - 460,000 acres - Forent has a 100% working interest in this block where again the Maritimes & North East pipeline will transport gas developments as it runs adjacent to the southern edge of the concession and has spare capacity. The block is also subject to the Province's 10% flat royalty applicable after the initial 2 year production royalty holiday. Oil seeps and gas shows have been detected on the block. Petroliferous Gays River reservoir rocks and both oil and gas prone Horton organic shales are seen at outcrop on the block. Further drilling and seismic is required to delineate these plays.
Dennis Forgeron, President and CEO of Forent Energy Ltd., was raised in Nova Scotia and has over 20 years experience in both large and junior oil and gas companies. He started in the industry in the late 80's with Gulf Canada drilling in the Beaufort Sea. Mr. Forgeron spent the next 5 years consulting both domestically and overseas, first in West Africa with Shell Gabon, and later with Canadian Occidental Petroleum on its Yemen assets, before returning his focus to Canada to manage various projects for Crestar and Texaco Canada. Mr. Forgeron founded Forent in 1998 and has operated Forent from its inception steadily growing the company.
W. Brett Wilson is Chairman of Prairie Merchant Corporation, a private merchant bank focused on business opportunities in the energy, agriculture, real estate, sports, and entertainment industries. In 1993, he co-founded FirstEnergy Capital Corp., a Canadian brokerage firm that provides investment-banking services to Canada's oil and gas sector. FirstEnergy is an industry leader, having participated in thousands of financing and M&A projects worth almost $200 billion. In 2007, he stepped back from active duty, but remains a partner in the firm. Brett is also a panelist on the CBC reality show Dragons' Den.