Base Oil & Gas Ltd., Calgary, (Toronto Venture: BOG) intends to issue, on a nonbrokered private placement basis, up to 7.2 million common shares, at a price of $0.28 per share, for gross proceeds of approximately $2 million.
Gross proceeds will be used to finance the company's share of the third earning well under a previously announced farm-in agreement to develop Cardium production with a private company in the Pembina area. By paying 50% of the drilling, completing, equipping and tie-in costs of the well, Base will earn a 30% working interest in the well and the Cardium rights within the section. The second earning well under this agreement has averaged approximately 300 barrels of oil equivalent per day since it was put on production Sept. 1.
The private placement is expected to close by Sept. 28.
Base Oil & Gas is an emerging E&P focused on the development of oil and gas reserves in the Western Canadian Sedimentary basin.
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