Adira Energy Ltd. announced that it is suspending operations on the Gabriella License due to lack of funding and lack of reasonable expectation of funding by certain parties sufficient to pursue the current work program; lack of agreement among the License holders regarding how to proceed under the circumstances; and due to the fact that Modi'in Energy L.P. ("Modi'in") has not met its obligations under the Joint Operating Agreement (the "JOA") or under other agreements in place among the JOA parties.
As the operator of the Gabriella License (the "Operator") the Company's obligation under the JOA is to (among other things) exercise due care with respect to the receipt, payment and accounting of funds in accordance with good and prudent practices generally followed by the international petroleum industry under similar circumstances. The Operator cannot continue to engage service providers and providers of equipment and material, without sufficient cash in the joint account, and with no reasonable expectation of cash being provided by the License partners.
As such, Adira has suspended operations on the Gabriella License. The Company continues to work with the all of its partners on the License to resolve these issues.
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