CGX, Frontera in Guyana Offshore Deal

February 4, 2019

Image: CGX Energy Inc
Image: CGX Energy Inc

Canadian oil and gas exploration company CGX Energy and compatriot petroleum exploration and production company Frontera Energy have executed a farm-in joint venture agreement covering CGX’s two shallow water offshore Petroleum Prospecting Licenses in Guyana, the Corentyne and Demerara Blocks.

These agreements remain subject to Guyanese government approval, said CGX.

A joint press release said that both the companies have entered into an amended and restated bridge loan agreement, pursuant to which Frontera has agreed to extend the term of CGX's April 25, 2018 bridge loan to September 30, 2019 and to update certain other terms and conditions.

Frontera has the option to convert up to US$8.8 million principal amount of the loan into CGX common shares at a conversion price of US$0.22 per share (being the US dollar equivalent of CDN$0.29, which was the closing price of the shares of CGX prior to the December 4, 2018 announcement of the amendment to the bridge loan), at any point on or before maturity of the loan.

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