Reef Resources has agreed to pricing terms for the previously announced brokered private placement being led by Jacob Securities Inc. Up to $2 million of flow through and non-flow through common shares will be priced at $0.11 per flow through common share and $0.10 per non-flow through common share. Jacob Securities has secured a lead order of up to $550,000 from an institutional investor representing 10% outstanding of Reef Resources Ltd. "post-closing". Closing of the Offering is expected to occur with 7 – 14 business days.
Solo Oil, an LSE - AIM listed company which currently holds a 23.8% working interest in Reef's Ontario properties will acquire up to an additional 14.3% working interest for $1.5 million following closing of a minimum $1.5 million under the Offering.
On Friday, October 7, 2011, the Company announced the successful production testing of its Ausable well #1 using hydraulic venturi downhole pump technology. The computed average daily production rate over the test period was 103 bopd with an estimated stabilized rate of 50 to 70 bopd.
The funds secured by Reef as a result of the working interest sale and Offering will be used to complete two additional wells in the Ausable pinnacle reef, tie-in an existing standing gas well in the Airport South reef, acquire pressurization natural gas for recycling in the Ausable reef, further execute on its existing field optimization program which includes the installation of additional venturi hydraulic pumps in its existing Ausable wells nos. 2, 4 and 5, as well as for general working capital.
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