Claren Energy to Pursue Spin-Off of Australian Assets
TORONTO, ONTARIO--(Marketwired - Nov. 9, 2017) - Claren Energy Corp. ("Claren" or the "Company") (TSX VENTURE:CEN)(OTCQX:TNVMF)(FRANKFURT:GLTN) is pleased to announce that it has entered into an arrangement agreement with its wholly owned subsidiary, Terra Nova Resources Inc. ("Terra Nova"), whereby Claren plans to pursue a Spin-Off of its working interests (51.49%) in two onshore petroleum exploration licenses ("PELs"), being PEL 112 and PEL 444, including a 1.47% overriding royalty interest in the PELs, located on the western flank of the Cooper Eromanga Basin in the State of South Australia, Australia.
The Board of Directors and management of Claren routinely review and assess strategic alternatives available to Claren to enhance shareholder value. As part of this review, the Board of Directors and management concluded that the Bobocu License, onshore Romania, and the PELs represent independent, and distinct value creation opportunities within the upstream oil & gas exploration and development cycle, and hence their intrinsic value should be reflected autonomously.
Henry Aldorf, CEO of Claren, commented "The proposed spin-out of the PELs will allow Claren to focus on the financing and advancement of its flagship property, the Bobocu License, as well as the acquisition of other onshore oil and gas assets in Eastern Europe. During the period from 2012 to 2016 the Company's focus was the exploration of the Australian PELs, which involved detailed 3D geophysical analysis as well as test drilling. We consider that the work carried out to date on the PELs warrants further exploration and an independent company is better suited to finance the exploration of the PELs."
Therefore, the Company intends to carry out a Plan of Arrangement ("Arrangement") with Terra Nova whereby Terra Nova will be listed as a separate company on the Canadian Securities Exchange ("CSE").
Terms of the Arrangement
According to the terms of the Arrangement entered into between Claren and Terra Nova, each Claren shareholder will receive one (1) Terra Nova common share for every ten (10) Claren shares held by such Claren shareholder. Further, the warrant holders of Claren will receive one (1) Terra Nova warrant for every ten (10) Claren warrants held, with an exercise price adjusted to reflect the spin out. The share and warrant exchanges will be based on security holdings as of the date following the Annual General and Special Meeting established by the Company.
Closing of the Arrangement is subject to a number of customary conditions precedent including, but not limited to, regulatory approval of this transaction, the approval of shareholders, the Supreme Court of British Columbia, and subject to compliance with the requirements of either the Canadian Securities Exchange or the TSX Venture Exchange.
About Claren Energy Corp.
Claren Energy Corp. is an oil and gas company that has a (40%) participating interest in the Bobocu License, onshore Romania, and has the right to acquire an additional forty percent (40%) participating interest in the license. Claren also has a 51.49% working interest in two onshore petroleum exploration licenses ("PELs"), being PEL 112 and PEL 444, including a 1.47% gross overriding royalty interest on the PELs, located on the western flank of the Cooper Eromanga Basin in the State of South Australia, Australia. Its common shares trade on the TSX Venture Exchange under the symbol "CEN".
This news release contains forward-looking information relating to Claren's intentions to conduct the drilling programs and other statements that are not historical facts. Such forward-looking information is subject to important risks and uncertainties that could cause actual results to differ materially from what is currently expected, for example: risks related to oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, competition from other producers, inability to retain drilling rigs and other services, reliance on key personnel, and insurance risks.. Findings by other oil and gas issuers does not necessarily indicate that Claren will be successful in making such findings in Australia and Romania. In making such forward- looking statements, Claren has relied upon certain assumptions relating to geological settings, commodity prices, the stability of markets and currencies and the availability of capital to Claren in order to continue with the seismic and drilling programs. You should not place undue importance on forward-looking information and should not rely upon this information as of any other date. While Claren may elect to, Claren is under no obligation and does not undertake to update this information at any particular time, except as required by applicable securities law. Neither the 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.
Claren Energy Corp.
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