Crown Point Responds to Misleading Comments from Dissident
(firmenpresse) - CALGARY, ALBERTA -- (Marketwired) -- 12/22/14 -- Crown Point Energy Inc. ("Crown Point" or the "Company") (TSX VENTURE: CWV) today responded to misleading comments made by dissident shareholder LAIG Oil Investments ("LAIG") regarding Crown Point and its transformative equity financing (the "Strategic Financing") with two strategic Argentinian investors.
"Our Strategic Financing is a transformative move for Crown Point that we have been working on since March," said Gordon Kettleson, Chairman of Crown Point. "Our ability to attract capital and investment in current market conditions speaks to the high quality of our assets and the experience of our management team."
"The Strategic Financing is superior in all respects to an opportunistic, coercive and highly dilutive financing (the "Inferior Proposal") proposed by LAIG. We believe LAIG is misrepresenting the facts about this financing and is pursuing this costly proxy contest to facilitate its opportunistic play for control of the Company," continued Mr. Kettleson.
"Because our priority was to focus on closing the first tranche of the Strategic Financing and our operations, we have not previously responded to LAIG's misrepresentations. Now that the first tranche has closed and we have solid exploration and development momentum, we want to be sure that shareholders are aware of the facts when assessing LAIG's motives and credibility."
Crown Point's Strategic Financing vs. LAIG's Inferior Proposal
LAIG has failed to disclose its real motivation for launching its costly proxy fight, which is to impose its Inferior Proposal on Crown Point for the benefit of LAIG at the expense of all other Crown Point shareholders.
Just prior to the Strategic Financing announcement in November, the Board rejected a demand by LAIG that Crown Point negotiate exclusively with LAIG to conclude the Inferior Proposal. Compared with the Strategic Financing, the terms demanded by LAIG are substantially less favourable to Crown Point and its shareholders, other than LAIG itself.
Shareholders should be aware of the following facts that LAIG should have disclosed, but did not:
Crown Point's Board and management are fully aware of their fiduciary obligations and have acted and continue to act in the best interests of the Company with respect to LAIG's Inferior Proposal as well as the Strategic Financing.
Crown Point Acted Appropriately in Reassessing El Valle
LAIG's criticism of Crown Point's strategic decisions in Argentina, such as the sale by Crown Point of the El Valle block in Argentina, are unreasonable. Contrary to LAIG's assertions, Crown Point acted appropriately in reassessing El Valle's value in light of disappointing drilling and operating results that were damaging its financial performance. Given Crown Point's limited cash resources, Crown Point acted reasonably in narrowing its strategic focus to Tierra del Fuego ("TDF") and the Neuquen basin.
Contrary to LAIG's assertions, Crown Point did not abandon the Laguna de Piedra and the Canadon Ramirez blocks. In the case of Laguna de Piedra, after the block was awarded to Crown Point local authorities placed a ban on surface access for drilling activities. In the case of Canadon Ramirez, a third party dispute between the provincial government and former owners of the property has so far prevented Crown Point from exercising its ownership rights. Crown Point believes these are both temporary force majeure situations and that the blocks still represent long term potential value for Crown Point.
Meanwhile, as previously disclosed, Crown Point is focused on increasing its TDF production base through exploration and development drilling supplemented by the recompletion and fracture stimulation of certain existing wells. Starting in the fourth quarter of 2014, Crown Point expects this program to begin adding to the production from existing TDF wells.
Moreover, now that Crown Point has disclosed the success of its first of two TDF exploration wells, Crown Point is hard at work identifying new drilling targets in the vicinity of the successful well. If the second TDF well is also successful, Crown Point expects to identify even more new drilling targets.
The Company is also pursuing high impact exploration programs in the Neuquen basin, where, contrary to LAIG's assertions, the La Hoyada XI exploration well remains prospective. The well is suspended and may be re-entered for additional testing.
LAIG's Groundless Criticism of Crown Point's Expenses
Contrary to the assertions of LAIG, Crown Point believes that its general and administrative expenses have been reasonable and that LAIG's criticisms are unfounded.
Notwithstanding Crown Point's regulatory obligations, responsible compensation policies and valued technical contributions to TDF, Crown Point is committed to efficiently managing its general and administrative expenses. In that context, Crown Point reduced G&A expenses by 17%, including a 22% decrease in salaries, during the nine month period ended September 30, 2014 compared with the same period in 2013. Prior to the initiation of this unnecessary and costly proxy contest by LAIG, Crown Point was on track to continue reducing G&A expenses in the fourth quarter of 2014.
About Crown Point
Crown Point Energy Inc. is an international oil and gas exploration and development company headquartered in Calgary, Canada, incorporated in Canada, trading on the TSX Venture Exchange and operating in South America. Crown Point's exploration and development activities are focused in the Austral and Neuquen basins in Argentina. Crown Point has a strategy that focuses on establishing a portfolio of producing properties, plus production enhancement and exploration opportunities to provide a basis for future growth.
Advisory
This press release contains forward-looking information. This information relates to future events and the Company's future performance. All information and statements contained herein that are not clearly historical in nature constitute forward-looking information, and the words "may", "will", "should", "could", "expect", "plan", "intend", "anticipate", "believe", "estimate", "propose", "predict", "potential", "continue", "aim", or the negative of these terms or other comparable terminology are generally intended to identify forward-looking information. Such information represents the Company's internal projections, estimates, expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. This information involves known or unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information. In addition, this press release may contain forward-looking information attributed to third party sources. Crown Point believes that the expectations reflected in this forward-looking information are reasonable; however, undue reliance should not be placed on this forward-looking information, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur.
This press release contains forward-looking information concerning, among other things, the following: the Company's assessment of the Inferior Proposal to the Strategic Financing; the Company's assessment of LAIG's motivations; the potential benefits of the Strategic Financing and the potential consequences of completing the Inferior Proposal; Crown Point's belief that LAIG is misrepresenting the facts about the Strategic Financing and is pursuing a costly proxy contest to facilitate its opportunistic play for control of Crown Point; statements with respect to Crown Point's focus on increasing its TDF production base through exploration and development drilling supplemented by the recompletion and fracture stimulation of certain existing wells and that Crown Point expects this program to begin adding to the production from existing TDF wells in the fourth quarter of 2014; the statement that Crown Point is working on identifying new drilling targets in the vicinity of the successful well and if the second TDF well is also successful, Crown Point expects to identify even more new drilling targets; that the Hoyada XI exploration well may be re-entered for additional testing; and Crown Point's assessment with respect to its G&A and compensation policies and practises compared to its peers and otherwise.
A number of risks and other factors could cause actual results to differ materially from those expressed in the forward-looking information contained in this press release including, but not limited to, the risk that the remaining portion of the Strategic Financing is not competed in a timely manner (or at all) or on the terms presently proposed; the risk that the Company is unable to realize the anticipated benefits of the Strategic Financing; the risk that Crown Point's TDF program does not result in additional incremental production or result in the identification of additional drilling locations; the risk that the Company's Hoyada XI exploration well may not be re-entered for additional testing; the risks and other factors described under "Risk Factors" in the Company's Annual Information Form, which is available for viewing on SEDAR at .
With respect to forward-looking information contained in this press release, Crown Point has made assumptions regarding, among other things: the impact of increasing competition; the general stability of the economic and political environment in which the Company operates; the timely receipt of any required regulatory approvals; the ability of the Company to fully complete the remaining portion of the proposed Strategic Financing in a timely manner (or at all) or on the terms it presently contemplates; the ability of the Company to continue as a going concern without the loss or forfeiture of any assets; the appropriate identification of its peer group for the purposes of compensation policies and practices; the ability of the Company to obtain qualified staff, equipment and services in a timely and cost efficient manner; drilling results; the costs of obtaining equipment and personnel to complete the Company's capital expenditure program; the ability of the operator of the projects which the Company has an interest in to operate the field in a safe, efficient and effective manner; the ability of the Company to obtain financing on acceptable terms when and if needed; field production rates and decline rates; the ability to replace and expand oil and natural gas reserves through acquisition, development and exploration activities; the timing and costs of pipeline, storage and facility construction and expansion and the ability of the Company to secure adequate product transportation; future oil and natural gas prices; currency, exchange and interest rates; the regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which the Company operates; and the ability of the Company to successfully market its oil and natural gas products. Management of Crown Point has included the above summary of assumptions and risks related to forward-looking information included in this press release in order to provide investors with a more complete perspective on the Company's future operations. Readers are cautioned that this information may not be appropriate for other purposes.
Readers are cautioned that the foregoing lists of factors are not exhaustive. The forward-looking information contained in this press release are expressly qualified by this cautionary statement.
The forward-looking information contained herein is made as of the date of this press release and the Company disclaims any intent or obligation to update publicly any such forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable Canadian securities laws.
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 news release.
Contacts:
Crown Point Energy Inc.
Murray McCartney
President & CEO
(403) 232-1150
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Datum: 22.12.2014 - 23:57 Uhr
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News-ID 361255
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CALGARY, ALBERTA
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Oil & Gas
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