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THE WOODLANDS, TX, March 6, 2012 /CNW/ - Porto Energy Corp., ("Porto" or the "Company") (TSXV:PEC), a company focused on oil and gas exploration, appraisal and development in Portugal, today announced that it has signed a non-binding Letter of Intent ("LOI") with an undisclosed party, the ("Partner"), whereby the Partner will farm in to Porto's rights on certain of the Company's concessions onshore Portugal, including the pre-salt potential on the Aljubarrota-3 concession. Under the terms of the LOI, the Partner will earn a 50% interest in the concessions, comprising approximately 600,000 gross acres (300,000 net to the Partner), in exchange for an aggregate farm-in commitment of up to US$23.0 million in payments and carried costs. The LOI is subject to customary break fees and conditions precedent. If definitive agreements are not entered into by April 30, 2012, the LOI will expire.
"Having a high working interest in each of our concessions provide us with maximum flexibility in the pursuit of partnering opportunities on our broad Portuguese asset base," said Joseph Ash, President and CEO of Porto Energy Corp. "Signing of this LOI demonstrates our ability to advance our joint venture strategy to further unlock our asset potential, increasing shareholder value. It will also allow us to fully fund the drilling of our 3-D imaged pre-salt exploration well by midyear."