CALGARY, Alberta, Dec. 02, 2020 (GLOBE NEWSWIRE) — Cenovus Power Inc. (TSX:CVE) (NYSE:CVE) and Headwater Exploration Inc. (TSX:HWX) are happy to announce the closing of the acquisition by Headwater of Cenovus’s belongings within the Marten Hills space of Alberta. Pursuant to the transaction, Headwater acquired a 100% working curiosity in roughly 2,800 barrels per day of medium gravity oil manufacturing and 270 web sections of Clearwater rights.
The overall consideration paid by Headwater to Cenovus for the transaction consists of:
- $35 million in money;
- 50 million frequent shares of Headwater; and
- 15 million buy warrants exercisable at $2.00 per frequent share with a three-year time period.
Concurrent with closing the transaction, Kam Sandhar, Cenovus’s Senior Vice-President, Typical, and Sarah Walters, Cenovus’s Senior Vice-President, Company Providers, had been appointed to the Board of Administrators of Headwater.
“With the sturdy help obtained from Cenovus, the Headwater crew has been in a position to put together for an energetic 2021 growth program. The distinctive high-return belongings acquired will present the catalyst for the following stage of our company evolution,” stated Neil Roszell, Headwater’s Chairman and Chief Govt Officer. “With Cenovus as a strategic investor and Kam and Sarah including to the abilities and expertise of our already sturdy Board, we’re well-positioned for achievement as a premier publicly traded oil and fuel producer centered on asset high quality, company degree returns and sustainability whereas sustaining a pristine stability sheet.”
“We look ahead to working with Headwater’s extremely revered administration crew as they start to develop these top-quality oil belongings at Marten Hills,” stated Sandhar. “It is a distinctive alternative to get capital and experience to work instantly on a promising portfolio that was unlikely to obtain near-term funding from Cenovus, and we imagine the closing of this transaction will present compelling long-term worth for Cenovus shareholders.”
On account of the transaction, Cenovus owns, by Cenovus Marten Hills Partnership, 50 million Headwater shares representing 25.6% of the corporate’s issued and excellent frequent shares. Together with the frequent shares issuable if the warrants are absolutely exercised, Cenovus would personal 65 million Headwater shares representing 30.9% of the corporate’s issued and excellent shares.
Cenovus has filed Type 62-103F1 Required Disclosure Below the Early Warning Necessities, on account of the transaction, a replica of which could be obtained on Headwater’s SEDAR profile at sedar.com or by contacting Cenovus’s Company Secretary at 225 6 Ave SW, PO Field 766, Calgary, Alberta, Canada T2P 0M5 or by phone at (403) 766-2000.
In reference to the completion of the transaction, Cenovus and Headwater entered into an Investor Settlement which supplies Cenovus the fitting to nominate two nominees to the Board of Administrators of Headwater if Cenovus, along with its associates, owns 20% or extra of the excellent frequent shares, or one nominee if it, along with its associates, owns 10% or extra however lower than 20% of Headwater’s excellent frequent shares.
The Investor Settlement additionally provides Cenovus the fitting to take part pro-rata in future choices of frequent shares or securities of Headwater that are convertible, exchangeable or exercisable into frequent shares, topic to Cenovus proudly owning or controlling, both straight or not directly, at the least 20% of the issued and excellent frequent shares on the time of such providing.
In accordance with the phrases of the Investor Settlement, Cenovus additionally agreed to vote, or trigger to be voted, the entire frequent shares held by it and its associates for or in any other case abstain from voting in respect of any administration proposal set forth within the administration types of proxy ready in respect of any assembly of shareholders of Headwater.
Ahead Wanting Statements Advisory
This information launch comprises sure forward-looking statements and forward-looking info (collectively known as “forward-looking info”) inside the which means of relevant securities laws, together with the USA Personal Securities Litigation Reform Act of 1995, about Cenovus’s and Headwater’s present expectations, estimates and projections concerning the future, primarily based on sure assumptions made by each firms in gentle of previous expertise and notion of historic developments. Though Cenovus and Headwater imagine that the expectations represented by such forward-looking info are cheap, there could be no assurance that such expectations will show to be right. Readers are cautioned to not place undue reliance on forward-looking info as precise outcomes might differ materially from these expressed or implied. Neither Cenovus nor Headwater undertake any obligation to replace or revise any forward-looking info besides as required by regulation.
This forward-looking info is recognized by phrases corresponding to “imagine”, “anticipated”, “alternative”, “will”, or related expressions and contains strategies of future outcomes, together with statements concerning the anticipated advantages of the transaction for every of Cenovus and Headwater.
Creating forward-looking info includes reliance on a variety of assumptions and consideration of sure dangers and uncertainties, a few of that are particular to Cenovus and/or Headwater and others that apply to the trade typically. Materials elements or assumptions on which the forward-looking info on this information launch are primarily based embrace: common financial circumstances; availability of required gear and providers; assumptions of future commodity costs (together with premiums); Canada-U.S. alternate fee; and different assumptions recognized herein.
Further details about dangers, assumptions, uncertainties and different elements that would trigger precise outcomes to vary materially from these expressed or implied by its forward-looking statements is contained beneath “Threat Administration and Threat Components” in Cenovus’s Annual Administration’s Dialogue and Evaluation (MD&A) or Type 40-F for the 12 months ended December 31, 2019, within the updates within the “Threat Administration and Threat Components” part of Cenovus’s MD&A for the interval ended September 30, 2020 and in Headwater’s Annual Data Type for the 12 months ended December 31, 2019 and different stories on file with Canadian securities regulatory authorities, which can be accessed by the SEDAR web site (sedar.com).
Cenovus Power Inc.
Cenovus Power Inc. is a Canadian built-in oil and pure fuel firm. It’s dedicated to maximizing worth by sustainably growing its belongings in a secure, progressive and cost-efficient method, integrating environmental, social and governance concerns into its enterprise plans. Operations embrace oil sands initiatives in northern Alberta, which use specialised strategies to drill and pump the oil to the floor, and established pure fuel and oil manufacturing in Alberta and British Columbia. The corporate additionally has 50% possession in two U.S. refineries. Cenovus shares commerce beneath the image CVE and are listed on the Toronto and New York inventory exchanges. For extra info, go to cenovus.com.
Headwater Exploration Inc.
Headwater Exploration Inc. is a Canadian junior useful resource firm engaged within the exploration for and growth and manufacturing of petroleum and pure fuel in Canada. Headwater at present has prime quality oil manufacturing, reserves and lands within the prolific Clearwater play within the Marten Hills space of Alberta and pure fuel manufacturing and reserves within the McCully Area close to Sussex, New Brunswick. Headwater is targeted on offering superior company degree returns by specializing in sustainability, asset high quality and stability sheet energy. Further company info could be present in our company presentation on our web site at headwaterexp.com.
Investor Relations common line
Media Relations common line
Neil Roszell, P. Eng.
Chairman and Chief Govt Officer
|Jason Jaskela, P.Eng.
President and Chief Working Officer
|Ali Horvath, CPA, CA
Vice President, Finance and Chief Monetary Officer