March 31, 2017 - Nanton, Alberta
Cerus Energy Group (“Cerus”) announces that it has entered into an agreement with a Third Party whereby for the commitment to spend up to ten million five hundred thousand dollars ($10,500,000.00) to drill, frack, test, complete and equip up to seven (7) one-mile long horizontal test wells on one of the operator’s project areas. The drilling program will consist of drilling, fracking, completing and equipping seven (7) one-mile long horizontal test wells on the project lands. This will be “Phase 1” on a project that has identified an additional 27 drilling locations on the project lands. The primary target is medium gravity (21 degree) oil. Drilling is expected to commence immediately after spring break up 2017.
Under the terms of the agreement Cerus will fund through the company’s DFP (Development Finance Platform) 100% of the development cost up to $10,500,000.00 for the costs incurred to drill, frack, test, complete and equip up to seven (7) wells on the project lands. The DFP agreement will entitle Cerus to 80% of the project’s Net Revenue until an undisclosed penalty is recovered from the project.
Post-payout, the DFP agreement will convert from its net profits interest to a non-convertible 5% gross overriding royalty in the Phase 1 wells and their respective drilling spacing units.
Under the terms of the agreement Cerus will have the first right of refusal to fund additional Phases of development drilling on the project lands, on the same terms and conditions as for the Phase 1 drilling program.
For further information regarding Camarico, see the Company's profile on SEDAR at www.sedar.com.
Mackenzie Loree, CEO
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Exchange) accepts responsibility for the adequacy or accuracy of this release.
FORWARD LOOKING INFORMATION
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