Manas Enters LOI to Sell Albanian Subsidiary, Assets
Manas Petroleum has entered into an arm's length binding letter of intent (the "LOI") dated November 19, 2009 with WWI Resources ("WWI"), a TSX-V listed company, pursuant to which Manas will sell all of the shares of one of its wholly-owned subsidiaries (the "Subsidiary") in exchange for a minimum of 100,000,000 common shares and a signing bonus in cash. At or prior to closing, Manas will reorganize its affairs such that the Subsidiary will own 100% of Manas' Albanian assets. The LOI provides that, after closing, WWI will be obligated to issue to Manas up to an aggregate of 150,000,000 additional WWI common shares upon the achievement of certain operational targets.
Completion of the transaction is subject to, among other things, completion of due diligence satisfactory to both parties, execution of a definitive agreement, receipt of all necessary regulatory and shareholder approvals and completion of a private placement in which WWI will sell 100,000,000 units at a price of $0.25 per unit for gross proceeds of (Cdn) $25,000,000. Each unit will consist of one common share and one warrant, with each warrant entitling the holder to purchase a further common share at a price of (Cdn) $ 0.45 per share for a period of 5 years from closing.
At closing, WWI and Manas will each appoint 3 directors to the board of WWI and the current officers of Manas will be appointed as officers of WWI.
At closing, the Subsidiary will hold three Production Sharing Contracts (PSCs) onshore Blocks in Albania that comprise 1.7 million net acres with 100% working interest. The PSCs are for Blocks A, B, D, E and for Blocks 2 & 3. There have been nine large structures identified in Blocks A, B, D & E and three structures on Blocks 2 & 3. It is important to note that Block 2 is within the area where Bankers Petroleum's (BNK.TO) current shallow oil production derives from. Manas has the right to explore and produce oil from the deeper targets. In 2001, the Shpiragu 1 well was drilled by Occidental Petroleum in Block 2. The Shpiragu-1 well averaged 400 -1,200 bbl/d of light oil, confirming an active hydrocarbon system. There are no known reserves on any of these properties.
Eric Herlyn, Chief Executive Officer of Manas Petroleum, commented, "We believe this is an excellent transaction for Manas as it will create significant shareholder value moving forward. This transaction is consistent with Manas' core strategy of acquiring high impact oil and gas licenses and then limiting the financial burdens and risks associated with the exploration and development." A more extensive press release will be out shortly which will provide more details of the transaction.