SAN FRANCISCO--(BUSINESS WIRE)--Heavy Earth Resources, Inc. ("Heavy Earth" or the "Company") (OTCQB:HEVI), an oil and gas exploration and production company focused on Central and South America, today announced that it entered into a non-binding letter of intent (“LOI”) through its wholly owned subsidiary Deep Core Barbados, with New Horizon Exploration, Inc., an oil and gas exploration and production company based in the United States with principal operations in Colombia (“New Horizon”), for the purchase of 100% of the equity ownership of New Horizon.
Heavy Earth currently owns a 25% working interest in the 68,302 acre La Maye Block in the Lower Magdalena Basin in Colombia. New Horizon is currently the operator of the La Maye Block. As part of the proposed transaction contemplated under the LOI, the Company will assume operatorship of the La Maye Block from New Horizon, while increasing its working interest in the La Maye Block to 38%.
The La Maye Block is immediately updip of the producing Cicuco and Boquete fields, and contains several seismically defined prospects, the largest of which has a significant amount of unrisked resources. With the purchase of New Horizon, the Company will be able to focus on its La Maye Block asset while retaining a significant interest in the Morichito Block. The Company believes that with the new structure, the exploration of the La Maye Block should proceed at a quicker pace. “We are very excited to have entered into this letter of intent and are anticipating closing this transaction by January 31, 2014. Together with our partners, we hope to be able to more rapidly expand the pace of the exploration of this very promising block,” said Anthony Ives, Chief Financial Officer of Heavy Earth. The Company is currently in the process of raising capital to drill the La Maye Block.
This proposed transaction remains subject to subject to a number of conditions, including due diligence, negotiation and execution of a definitive agreement and customary regulatory approvals. While the Company expects to close this transaction by January 31, 2014, there can be no assurance that due diligence will be satisfactory, that regulatory approvals will be received, that a definitive agreement will be entered into or that this transaction will be consummated as proposed or at all.
About Heavy Earth Resources, Inc.
Heavy Earth Resources, Inc. is an oil and gas exploration, development and production company focused on under-explored regions and basins with proven petroleum geology fundamentals in Central and South America. The Company holds a significant drill ready, lower risk, prospect inventory in the Llanos and Lower Magdalena Basins. Heavy Earth Resources, Inc.’s shares trade on the OTCQB under the symbol HEVI. For more details on the Company, please visit www.heavyearthresources.com.
This press release contains forward-looking statements (as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended) concerning future events and the Company’s growth and business strategy. Words such as "expects," "will," "intends," "plans," "believes," "anticipates," "hopes," "estimates," or the negative thereof, and other variations on such words and similar expressions are intended to identify forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. These statements involve known and unknown risks and are based upon a number of assumptions and estimates that are inherently subject to significant uncertainties and contingencies, many of which are beyond the control of the Company. Actual results may differ materially from those expressed or implied by such forward-looking statements.
Factors that could cause actual results to differ materially include, but are not limited to, risks associated with drilling and production programs on the Morichito and La Maye Blocks resulting from geological, technical, drilling, seismic and other unforeseen problems; unexpected results of exploration and development drilling and related activities on the Morichito and La Maye Blocks; continued availability of capital and financing to fund exploration and development drilling activities; increases in operating costs; availability of skilled personnel; unpredictable weather conditions; the impact of political and economic instability in Colombia; the ability to obtain required approvals of regulatory authorities in Colombia; senior management’s general inexperience in oil and gas operations in Colombia; members of senior management not being based in Colombia, and other factors listed from time to time in the Company's filings with the Securities and Exchange Commission. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company’s expectations with respect thereto or any change in events, conditions or circumstances on which any such statement is based.
Cautionary Note to U.S. Investors - The United States Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only reserves that comply with the definitions presented at Rule 4-10(a) of Regulation S-X. We use certain terms in this press release that the SEC's guidelines strictly prohibit us from including in filings with the SEC. Examples of such disclosures would be statements regarding "probable," "possible," "recoverable," or “prospective” "reserves," and "resources" among others. U.S. Investors are urged to consider closely the disclosures in our Registration Statement on Form S-1 filed on October 12, 2012, and other filings available at www.sec.gov or from us at Heavy Earth Resources, Inc., 1890 Bryant Street, Suite 316, San Francisco, California 94110.