MARKSMEN ANNOUNCES EXERCISE OF WARRANTS, OPERATIONAL UPDATE AND EARLY WARNING REPORT
CALGARY, ALBERTA, Feb. 13, 2023 (GLOBE NEWSWIRE) -- Marksmen Energy Inc. (“Marksmen” or the “Company”) (TSXV: MAH) announces that 10,260,714 share purchase warrants at an exercise price of $0.07 per share have been exercised for total proceeds of $718,250 and one common share of Marksmen will be issued for each share purchase warrant exercised.
Marksmen completed the drilling of three wells in Pickaway County, Ohio in late 2022. Putting the wells on production was delayed due to multiple factors, including waiting on installation of water disposal lines, electrical hook-up and county permit approvals, lease construction, and fabrication and supply of production tanks, all of which were impacted by supply chain issues and cold weather delays. Production has been phased in at these wells starting in late December 2022.
Holbrook Davis #1 - this well was the first to be put on production in late December 2022 and is now producing approximately 20 plus barrels of oil per day. Management believes optimization work may increase this production by up to 5 plus barrels per day.
Holbrook Davis #2 – this well was waiting on parts due to delays from supply chain issues before it was put on production in late January 2023. Preliminary production from the lower Cambrian Knox zone has started at 5 to 7 barrels per day but management believes optimization work could move this number up to 20 barrels per day. During the drilling of this well, a zone of interest above the Cambrian Knox was encountered that flowed significant oil to surface. This zone has been cased and cemented and is awaiting further technical review to determine the best method of completion.
Davis #1 – when this well was swab tested, it was the best of the three wells with a 70% oil cut. Since it was shut-in waiting to be put on production, formation water has accumulated and needs to be pumped off. Production of water began in late January 2023, and water is being produced via water disposal lines to Marksmen's water disposal well. The cost of water disposal is very low as no trucking is required. The well is beginning to show some small amounts of oil.
To speed up the water production process and to allow oil production to be optimized to a management estimated level of 20 plus barrels per day, the Company is planning to change out the bottom hole pumping assembly and look at various proven well bore intervention techniques.
In Alberta, a well that Marksmen has a 24.5 % working interest in, which was shut-in awaiting regulatory approval, was put back on production in December 2022 and will contribute from 5 to 7 barrels of oil per day plus some natural gas.
The wells above have added 30 plus barrels of oil production per day and management believes optimization efforts will add another 30 barrels of oil per day. This meaningful new increase in production will result in the Company being cash-flow positive with increased funds available for capital projects.
In February 2023, Marksmen will complete the optimization of the above wells, and complete its plans for the drilling or recompletion of new wells in Ohio. There are a number of opportunities that have been presented to Marksmen that are currently being prioritized, with the first project expected to begin in March 2023.
Marksmen further announces that an early warning report has been filed by Glenn Walsh, an insider of the Company. On February 9, 2023, Mr. Walsh exercised 4,285,714 share purchase warrants of the Issuer (the “Warrants”) held indirectly through his wholly owned company, Conex Services Inc. (“Conex”), resulting in the disposition of 4,285,714 Warrants and the acquisition of 4,285,714 common shares of the Company (the “Common Shares”). Mr. Walsh previously filed an early warning report on January 10, 2022, and the exercise of the Warrants resulted in an increase to his undiluted holdings of 2.05% which triggered the requirement to file the report.
As at the date of Mr. Walsh's previously filed early warning report of January 7, 2022, Mr. Walsh held, directly and indirectly, 15.61% of the issued and outstanding Common Shares on an undiluted basis (17.55% on a diluted basis). Prior to the exercise of the 4,285,714 Warrants by Conex, he held, directly and indirectly, 16.27% of the issued and outstanding Common Shares on an undiluted and diluted basis. Following the exercise of the 4,285,714 Warrants, Mr. Walsh holds, directly and indirectly, 17.66% of the outstanding Common Shares on an undiluted and diluted basis.
Immediately after the transaction that triggered the requirement to file the report, Mr. Walsh held, directly and indirectly, 33,112,881 Common Shares representing 17.66% of the issued and outstanding Common Shares on an undiluted and diluted basis.
Mr. Walsh intends to increase or decrease his holdings in the Company depending on market conditions and as circumstances warrant.
A report respecting this acquisition has been filed with the applicable securities commissions using the Canadian System for Electronic Document Analysis and Retrieval (SEDAR) and is available for viewing on the Company's profile at www.sedar.com.
For additional information regarding this news release please contact Archie Nesbitt, Director, and CEO of the Company at (403) 265-7270 or e-mail email@example.com.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
This news release may contain certain forward-looking information and statements, including production optimization of existing wells and the results therefrom, the timing for and drilling or recompletion of new wells, whether the Company becomes cash flow positive and the timing thereof, and statements pertaining to Mr. Walsh's intentions. All statements included herein, other than statements of historical fact, are forward-looking information and such information involves various risks and uncertainties. Marksmen does not undertake to update any forward-looking information except in accordance with applicable securities laws. There can be no assurance that such information will prove to be accurate, and actual results and future events could differ materially from those anticipated in such information. A description of assumptions used to develop such forward-looking information and a description of risk factors that may cause actual results to differ materially from forward-looking information can be found in Marksmen’s disclosure documents on the SEDAR website at www.sedar.com.