ZAAB ENERGY AG
ZAAB ENERGY AG: ZAAB Energy AG acquires producing oil and gas assets in Canada
ZAAB ENERGY AG / Miscellaneous/Miscellaneous 26.11.2009 Dissemination of a Corporate News, transmitted by DGAP - a company of EquityStory AG. The issuer / publisher is solely responsible for the content of this announcement. --------------------------------------------------------------------------- Munich, 25 November 2009. ZAAB Energy AG is pleased to announce the acquisition of a majority interest (approximately 51%) in Black Sea Oil and Gas Ltd. ('BSOG'), Canada. BSOG is an exploration and production company with hydrocarbon licences in five areas in the Canadian provinces of Alberta and Saskatchewan. Current production is around 220 barrels of oil equivalent per day which is currently concentrated in the licence area Worsley (Alberta). However, BSOG holds a total of 35 hydrocarbon licences and thus has large potential to grow further. Proven and probable oil and gas reserves currently stand at 3.38 million barrels according to BSOG's estimates. BSOG gives no estimate as to possible reserves at this stage. The company expects to be able to grow its reserve base significantly by doing further work in its existing licence areas. The company targets to increase production to 500 barrels of oil and gas by first quarter 2010 and to 1,000 barrels of oil and gas by the end of 2010. Given the fact that BSOG already has 12 producing wells and that several hundred barrels of production are currently 'behind pipe', i.e. only have to be connected to existing pipeline systems, this is feasible according to BSOG's assessments. ZAAB Energy AG subscribed to a capital increase in BSOG and thus the funds paid by ZAAB Energy AG will solely be used for the development of the company and not be paid to existing BSOG shareholders. Both parties have agreed not to disclose the purchase price. The investment was financed by a shareholder loan received from ZAAB Energy AG's majority shareholder. Therefore, there is no dilutive effect for ZAAB Energy AG shareholders. The shareholder loan has been provided on favourable terms for ZAAB Energy AG. Since last year ZAAB Energy AG has re-evaluated its existing exploration portfolio in the four licence areas in Southern Russia and also reviewed its investment strategy. The decline in crude oil prices since the summer of last year has provided ZAAB Energy AG with opportunities to acquire proven and probable reserves (i.e. hydrocarbon reserves with a high degree of certainty) in- and outside the Russian Federation at reasonable prices, without the need to spend exploration costs and without exploration risk. ZAAB Energy AG assessed i.a. several investment opportunities in Canada. The management of ZAAB Energy AG believes that BSOG is an excellent opportunity to purchase a low risk asset. 'This transaction provides ZAAB Energy AG with an opportunity to invest directly in producing assets with an attractive upside potential. At the same time we can benefit from the high level of technology available in Canada and transfer know how to our Russian assets,' said Dr. Carsten Geiger, chief geologist of ZAAB Energy Group. About ZAAB Energy AG ZAAB Energy AG is a Munich based independent oil and gas exploration and production company. ZAAB Energy AG's Russian subsidiary ZAAB Invest holds a licence portfolio of four areas located in the Russian Federation between Black and Caspian Sea with significant oil and gas resources. ZAAB Energy AG also holds a majority interest in the Canadian oil and gas company Black Sea Oil and Gas Ltd. Further information is available on www.zaabenergy.com. Forward looking statements This news release is based on partly forward looking statements i.a. on planned drillings and expansion drillings, as well as associated costs and estimates of oil and gas production, cash flows and other factors. All statements such as planned, estimated, expected, potential etc. are of a forward looking nature. Although ZAAB Energy AG is of the opinion that the forward looking statements are plausible, they comprise risks and uncertainties in a way that the occurrence of the assumed results may not be warranted. Important factors that may lead to deviations between the actual results and the forward looking statements are e.g. issues of a technical or mechanical nature or geological issues, which may lead to the result that a commercial recovery of the reserves or resources is not possible. In addition, prices may have an important impact on profitability. No offer to sell shares This document represents neither an offer to sell shares of ZAAB Energy AG ('the Company') nor an invitation to make an offer to purchase shares of the Company. This document and the information contained therein may not be brought into or transmitted to the United States of America or distributed or transmitted to American persons (including legal entities as defined in Regulation S of the United States Securities Act of 1933, as amended - the 'Securities Act') or to publications with a general circulation in the United States of America. Each violation of such limitations may constitute a violation of applicable securities laws. The shares of the Company have not been, and will not be, registered under the Securities Act, or with any securities regulatory authority of any state or other jurisdiction of the United States, and may not be offered or sold within the United States or to, or for the account or benefit of any US person (as defined in Regulation S under the Securities Act) except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There shall be no sale of shares in the Company in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to qualification under securities laws of such state or jurisdiction. Board of directors Jan-Hendrik Röver, Member of the Board, tel.: +49 89 242 246 910 26.11.2009 Financial News distributed by DGAP. Media archive at www.dgap-medientreff.de and www.dgap.de ---------------------------------------------------------------------------
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