| October 13, 2011 |
| CGX Announces Investment by Pacific Rubiales |
TORONTO, ONTARIO--(Marketwire - Oct. 13, 2011) -
NOT FOR DISTRIBUTION TO US NEWS WIRE SERVICES OR DISSEMINATION IN THE US.
CGX Energy Inc. (TSX VENTURE:OYL) ("CGX") is pleased to announce that Pacific Rubiales Energy Corp. (TSX:PRE)(BVC:PREC) ("Pacific Rubiales") has agreed to purchase 58,720,000 common shares ("Offered Shares") of CGX at a price of $0.70 per Offered Share for an aggregate investment of $41,104,000. The investment by Pacific Rubiales will be made pursuant to CGX's recently announced bought deal financing through a syndicate of underwriters led by Cormark Securities Inc. and including GMP Securities L.P., Canaccord Genuity Corp., Macquarie Capital Markets Canada Ltd., Jennings Capital Inc. and Toll Cross Securities Inc. (collectively, the "Underwriters") whereby CGX has agreed to issue 114,300,000 Common Shares at a price of $0.70 per Common Share for aggregate gross proceeds of $80,010,000 (the "Offering"). Pursuant to the Offering, CGX has also granted the Underwriters an option (the "Over-Allotment Option") to purchase up to an additional 17,145,000 common shares of CGX to cover over-allotments, if any, at a price of $0.70 per common share for additional gross proceeds of $12,001,500. The use of the net proceeds of the Offering is set out under the heading "Use of Proceeds" in the final prospectus of CGX dated October 12, 2011.
Pacific Rubiales does not currently hold any common shares or other securities of CGX. Following completion of the Offering, Pacific Rubiales will hold approximately 19% of the outstanding common shares (18% of the outstanding common shares if the Over-Allotment Option is exercised in full). Accordingly, the purchase of Offered Shares by Pacific Rubiales will not result in the creation of a new control person of CGX as such term is defined under applicable Canadian securities legislation. As part of making the investment in CGX, Pacific Rubiales has agreed not to make any offers to purchase outstanding common shares or other securities of CGX for a period of 12 months without the prior consent of the board of directors of CGX.
The Offering and the investment by Pacific Rubiales are subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the TSX Venture Exchange and the applicable securities regulatory authorities. Closing of the Offering is expected to occur on or about October 19, 2011.
CGX is a Canadian-based oil and gas exploration company focused on the exploration for oil in the Guyana / Suriname Basin, an area that is ranked second in the world for oil and gas prospectively by the United States Geological Service. CGX is managed by a team of experienced oil and gas and finance professionals from Canada, the US and the UK. Additional information on CGX may also be examined and/or obtained through the internet by accessing the website of CGX at www.cgxenergy.com.
Pacific Rubiales, a Canadian-based company and producer of natural gas and heavy crude oil, owns 100 percent of Meta Petroleum Corp., a Colombian oil operator which operates the Rubiales and Piriri oil fields in the Llanos Basin in association with Ecopetrol, S.A., the Colombian national oil company. Pacific Rubiales is focused on identifying opportunities primarily within the eastern Llanos Basin of Colombia as well as in other areas in Colombia and northern Peru. Pacific Rubiales has working interests in 45 blocks in Colombia, Peru and Guatemala. Pacific Rubiales' common shares trade on the Toronto Stock Exchange and La Bolsa de Valores de Colombia under the ticker symbols PRE and PREC, respectively. Additional information on Pacific Rubiales may also be examined and/or obtained through the internet by accessing the website of Pacific Rubiales at www.pacificrubiales.com.
The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or applicable exemption from the registration requirements. This news release does not constitute an offer to sell or the solicitation of any offer to buy nor will there be any sale of these securities in any province, state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such province, state or jurisdiction.
Forward-Looking Statements
This press release contains forward-looking statements. More particularly, this press release contains statements which include, but are not limited to, the timing of closing of the Offering and the investment by Pacific Rubiales, the amount of Pacific Rubiales' investment, the anticipated use of proceeds, the receipt of the required regulatory and third party approvals.
The forward-looking statements are based on certain key expectations and assumptions made by CGX. Although CGX believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because CGX can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. In addition to other risks that may affect the forward-looking statements in this press release, the closing of the Offering and Pacific Rubiales' investment in CGX could be delayed if CGX is not able to obtain the necessary regulatory and stock exchange approvals on the timelines it has planned and the Offering will not be completed at all if these approvals are not obtained or some other condition to the closing is not satisfied. Accordingly, there is a risk that the Offering will not be completed within the anticipated time or at all. The intended use of the net proceeds of the Offering by CGX might change if the board of directors of CGX determines that it would be in the best interests of CGX to deploy the proceeds for some other purpose.
The forward-looking statements contained in this press release are made as of the date hereof and CGX undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
Trading Symbol OYL
Shares Outstanding 194,778,663
Fully Diluted 210,228,663
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE. | |