Calgary, Alberta–(Newsfile Corp. – September 16, 2021) – Cuda Oil and Gas Inc. (TSXV: CUDA) (“Cuda” or the “Company“) announces that it has entered into a Share Purchase Agreement (“Agreement“) to sell all of the shares of Cuda Energy Inc., a wholly-owned subsidiary of the Company that holds its Alberta assets, to an arm’s length private company (the “Purchaser“). The Purchaser has agreed to pay total cash consideration of $2.67 million, subject to certain adjustments, and has provided a deposit of $135,000. The completion of the transaction is subject to the Purchaser being satisfied with its due diligence review and other customary closing conditions. There is no certainty that all of the closing conditions will be satisfied. The targeted closing date for completion of the sale is September 30, 2021.
Transaction Highlights
- The sale of Cuda Energy Inc. will result in the disposition of all of the Company’s Alberta petroleum and natural gas rights, tangible assets and miscellaneous interests and related liabilities including environmental obligations, but excluding certain defined liabilities such as outstanding loans and employee compensation and claims;
- Agreement contemplates Cuda Energy Inc. having a neutral working capital position at the closing date of the transaction; and
- During the second quarter of 2021, the Alberta assets produced 954 mcf/d of natural gas and 15 bbls/d of natural gas liquids.
Proceeds from the Alberta sale will be used to advance development and increase oil production of Cuda’s major asset at Barron Flats Shannon Secondary Recovery Unit in Wyoming and for corporate working capital purposes.
ARCO Capital Partners Inc. acted as financial advisor to Cuda in respect of the transaction.
About Cuda Oil and Gas Inc.
Cuda Oil and Gas Inc. is engaged in the business of exploring for, developing and producing oil and natural gas, and acquiring oil and natural gas properties across North America. The Cuda management team has worked closely together in both private and public company environments. Cuda will continue to implement its proven strategy of exploring, acquiring, and exploiting with a long-term focus on large, light oil resource- based assets across North America including significant operational experience in the United States. The Cuda management team brings a full spectrum of geotechnical, engineering, negotiating and financial experience to its investment decisions.
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