Marketwire
VANCOUVER, BRITISH COLUMBIA--(Marketwired - Sept. 17, 2013) - Rift Basin Resources Corp. (TSX VENTURE:RIF.H) (the "Company" or "Rift Basin") is pleased to announce it has entered into a letter of intent (the "LOI") with a Lebanese financing group (the "Funder") to share the economic obligations and benefits of its pending interest in the Indonesian onshore multi-reservoir oil field known as the Dandangilo & Beji Block ("the "Field"), the initial project under the Memorandum of Understanding announced on June 5, 2013 (the "MOU").
Under the terms of the LOI, the Funder will advance initial operating capital of up to US$700,000 to fully fund technical assessment, equipment acquisition, mobilization, service and enhancement work and administrative support as required for the first five wells on the Field, in compliance with the Company's obligations under the MOU. Operations will be conducted through a jointly-owned (50:50) operating company ("PT Rift"). The Funder has advanced US$50,000 to the Company as evidence of its good faith and intentions pending completion of definitive agreements and customary closing conditions, including due diligence and TSX Venture Exchange approval.
Upon commencement of commercial oil production, the Funder will be entitled to priority recovery of its initial operating capital advanced, on a 70:30 basis of PT Rift company profit, until full recovery. Upon achieving full recovery, Rift Basin will be entitled to 70% of PT Rift company profit until it has in turn recovered US$700,000 in full recognition of its own past costs and the introduction of the opportunity to the Funder. Subsequent to the complete satisfaction of these recoupment conditions, the parties will proceed to jointly commercialize the Field on a 50:50 basis.
Concurrent with the Company's efforts to economically commercialize the Field's existing wells, a technical team is evaluating the deeper target potential in the basin, with technical and resource assistance provided by an arms-length intermediate oil and gas production company that is also participating in the Company's announced private placement for up to $200,000.
The Indonesian Opportunity
The Dandangilo & Beji Block has historic and current oil production. It is located in Bojonegoro, East Java, Indonesia, and contains 110 existing shallow wells within an 80 sq.km. area. According to data on file at the University of Pembangunan Nasional Veteran, Jakarta, original oil in place in the Field reservoir was 112 million stock tank barrels ("MMSTB"). Pertamina recorded production of approximately 20 MMSTB during the period 1963-1980 after which no commercial operations were undertaken.
ExxonMobil is reported to have discovered a very substantial oil accumulation at the deeper Kujung horizon in its Cepu Block, approximately 15km to the south of the Field. Public reports suggest the Cepu field is expected to produce 165,000 barrels of oil per day when fully developed.
About Rift Basin
The Company is listed on the NEX, a separate board of the TSX Venture Exchange, under the symbol "RIF.H". The Company is seeking to graduate to Tier 2 of the TSX Venture Exchange and become an oil and gas issuer. Additional information about Rift Basin is available under Rift Basin's SEDAR profile at www.sedar.com.
ON BEHALF OF RIFT BASIN RESOURCES CORP.
Wayne Koshman, Chief Executive Officer
Some of the statements contained in this press release are forward-looking statements and information within the meaning of applicable securities laws. Forward-looking statements and information can be identified by the use of words such as "expects", "intends", "is expected", "potential", "suggests" or variations of such words or phrases, or statements that certain actions, events or results "may", "could", "should", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements and information are not historical facts and are subject to a number of risks and uncertainties beyond the Company's control. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this news release. Accordingly, readers should not place undue reliance on forward-looking statements. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements, except as may be required by law.
Neither TSX Venture Exchange nor its Regulations Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.