Nordic has exercised its right to terminate the asset purchase agreement dated May 21, 2010 between the Company and Western Plains Petroleum pursuant to which the parties had agreed that Western Plains would acquire a 50% interest in Nordic's land holdings and heavy oil wells in Lloydminster, Alberta.
The Asset Purchase Agreement had contemplated the closing of the transaction by July 31, 2010.
"Unfortunately, this will delay the repayment of certain liabilities, however we believe that a resolution on the matter relating to the sale of the Lloydminster assets or the re-financing of the Company will be concluded in the near term," Mr. Benson stated.
While to date Western Plains has not been able to conclusively demonstrate to Nordic that it has obtained the necessary financing to conclude the transaction, Nordic believes Western Plains may be able to secure satisfactory financing in a timely manner enabling it to come back to Nordic and negotiate a purchase on satisfactory terms. However, as yet Western Plains has not communicated its intentions to Nordic.
In the interim, with rising oil prices (oil closed at $81.49 per barrel on Monday, up $2.54 from Friday's $78.95 close), Nordic will be exploring all avenues including refinancing and other potential buyers.
In other news Mr. Benson also noted that the Company has completed the surveying of its new well location in Endeavour, Saskatchewan and will be moving toward the licensing of the new well.
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