Apr 03, 2003
Frontier Announces Acquisition of Sidox Canada and Farmout in Northwest Territories
International Frontier Resources Corporation (the "Company") reported today that the Company has entered into an agreement to acquire 100% of the issued shares of Sidox Chemicals Canada Ltd. ("Sidox Canada") from Devon Investments Ltd. ("Devon"). Sidox Canada and Devon are parties to a joint venture agreement with Enhanced Recovery Systems Ltd. ("ERS") who hold an International patent on a new production technology for the chemical compound SIDOX that enhances oil production and reduces water cuts in sandstone reservoirs. Sidox is a relative permeability modifier that was successfully tested in a twelve-well pilot project that yielded an average post treatment BOPD increase of 101% (minimum 53%, maximum 172%) for an average period of five months. The Company has identified a host of sandstone reservoirs in eastern and southern Alberta that are water wet that the Company believes will benefit from the application of SIDOX.
The joint venture provides ERS with the right to acquire a 50% shareholding in Sidox Canada and the Company with the right to acquire a ten-year Exclusive License Agreement in Canada.
The consideration for the purchase of all the issued and outstanding shares of Sidox Canada is the issuance of 2,000,000 non transferable warrants, the warrants entitle Devon to acquire 2,000,000 shares of International Frontier at $0.25 for two years and $0.35 in the third year from the date of closing. The warrants can only be exercised if Sidox Canada acquires a ten-year Exclusive License for SIDOX and if wells in which the Company holds an interest that have been treated with SIDOX achieve a minimum 25% BOPD increase for a period of 100 days. The purchase of Sidox Canada is a non arm's length transaction as defined by TSXV Exchange policy 1.1 as the shares of Devon are controlled by Pat Boswell, President of the Company. The transaction is also subject to TSX Venture Exchange approval.
The Company also reported today that an amended joint venture and financing agreement covering EL-397 and TDL parcels M-36, M-37 and M-38 located in the Northwest Territories, Canada has been signed. Pursuant to the agreement the joint venture partner will pay 20.75% of the cost to drill an exploration well on EL-397 to earn 16.75%, the company will pay 1% of drilling costs to retain a 5% interest in the lands. The operator of EL-397 estimates the cost to drill a 3000-meter well in the $16 to $20 million range. The high impact well, which is scheduled to spud in Q-1, 2004 will test a cretaceous oil prospect and a deep Devonian oil/gas prospect.
For additional information contact:
Pat Boswell, President & CEO
Phone: 403- 215-2780
Fax: 403- 215-2788
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the contents of this news release.
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