Cirrus has entered into a definitive share purchase agreement for the acquisition of Wilderness Energy UK Limited ("WEUK") which will become a fully-owned subsidiary of Cirrus. The acquisition is expected to close on or about June 16, subject to regulatory approval. The consideration for the acquisition is 500,000 freely tradable ordinary shares of Cirrus.
WEUK is a wholly owned subsidiary of Wilderness Energy Corporation, a private Canadian junior exploration and production Company. WEUK was formed in 2005 to acquire prospective acreage in the UK North Sea and currently holds non-operated interests ranging from 25% to 50% in eight exploration licenses in the central and northern North Sea and one exploration license in the southern North Sea. Gross acreage under license is 1972 km2 (800 km2 net) and there are currently one gas and fifteen medium to heavy oil prospects and leads identified. The licenses expire in 2012 or later.
All of the licences were jointly acquired by WEUK and Silverstone CNS Limited ("Silverstone") who operates all of the licences. There are no firm well commitments and ongoing work commitments over the next two years are estimated to total GBP 700,000 net to WEUK which includes lease rentals and geological and geophysical work.
Cirrus President and CEO David Taylor commented, "This acquisition provides an attractive low cost entry into the UK North Sea. The licences contain significant exploration potential particularly for heavy oil which has recently benefited from improved fiscal terms. As there are no firm drilling commitments in the acquired UK licenses, Cirrus remains fully in control of its investment decisions but at the same time gains exposure to significant exploration upside and further opportunities in an additional attractive low-risk jurisdiction. This acquisition expands and broadens the future opportunity portfolio for Cirrus without diluting its focus on the exploration and development of its operated assets in the Dutch North Sea."
Cirrus Energy Corporation is an international oil and gas company headquartered in Calgary and will have approximately 78.9 million fully diluted common shares outstanding upon closing of this acquisition.
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