Strata-X Energy Ltd. (Toronto Venture:SXE) has announced a non-brokered private placement of up to 21.7 million Chess Depository Interests (CDIs) in the company at a price of AUD$0.17 per CDI for gross proceeds of up to approximately AUD$3.7 million. The placement is expected to close on Friday, November 21, subject to receipt of necessary regulatory approvals, including the approval of the TSX Venture Exchange and Australian Securities Exchange. The CDIs will be subject to resale restrictions in Canada for a period of four months and one day from the date of issuance.

The company intends to use the proceeds from the placement as follows:

  • Drilling, stimulating, if required, and testing up to five low cost vertical wells in the Illinois Basin projects targeting bypassed and/or untested high margin light sweet oil within multiple shallow reservoirs at depths of 750m to 1110m;
  • Continued long-term testing of the first "proof of concept" well in the Burkett Oil Field to estimate production declines required for economic modeling of the field;
  • Flow testing the first "proof of concept" well on the Sleeping Giant Gas Project which has 25 meters of interpreted gas pay. Strata-X has third party verified, unrisked, undiscovered 398 Bcf PIIP net to the company's interest in this project. Undiscovered resources are those quantities of oil and gas estimated on a given date to be contained in accumulations yet to be discovered. There is no certainty that any portion of the resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the resources.
  • Lease maintenance and general working capital purposes.

Each placement CDI will represent one common share of Strata-X and will rank equally with existing CDIs. All CDIs issued pursuant to the Placement are to be fully tradable and listed on the Australian Securities Exchange, subject to the necessary approvals by the TSX-V and ASX, respectively.

Strata-X is based in Denver.