Brownstone Ventures Inc.

Brownstone Ventures Inc.

April 03, 2006 08:00 ET

Brownstone and Canoro Enter Into Letter of Intent for Farm-In on Indian Blocks

TORONTO, ONTARIO--(CCNMatthews - April 3, 2006) - Brownstone Ventures Inc. (TSX VENTURE:BWN) ("Brownstone"), is pleased to announce that it has entered into a letter of intent with Canoro Resources Ltd. (TSX VENTURE:CNS) ("Canoro") whereby Brownstone will farm-in for a 15% participating interest in Canoro's AA-ON/7 and AA-ONN-2003/2 exploration blocks in northeast India, subject to governmental and other approvals. Canoro and Brownstone have also agreed to work together on future opportunities in India for the next three years.

For Brownstone, this letter of intent marks an entry point into India's tight oil and gas market and access to Canoro's significant Indian experience and oil and gas expertise. Canoro's balance sheet is strengthened and its capital exposure to exploration reduced, providing flexibility for development expenditures for the Amguri field and NELP VI.

To earn the 15% participating interest in both blocks, Brownstone will be paying a portion of Canoro's past and current costs, including 2-D seismic costs, in the aggregate of up to US$2 million with respect to work on the blocks and, in addition, Brownstone will issue to Canoro 400,000 common shares and 200,000 share purchase options entitling Canoro to purchase one common share in Brownstone at a price of $2.20 for a period of five years, subject to TSX Venture Exchange approval. Canoro's existing partners in each block have pre-emptive rights on any transfer of interest by Canoro. The transaction is also subject to usual conditions including due diligence and approval by the TSX Venture Exchange.

About Canoro - Canoro is a Canadian-based international oil and gas company operating in the prolific Assam/Arakan basin of northeast India. The Company has restored production from the suspended Amguri oil and gas field. Canoro is the operator of Amguri and has a 60% working interest. Canoro is the operator with a 65% working interest in the 1,445 km2 AA-ON/7 exploration block, and has a 30% non-operated working interest in the 295 km2 AA-ONN-2003/02 exploration block, which will be reduced to 50% and 15% respectively following successful completion of the transaction with Brownstone.

About Brownstone - Brownstone is an investment company which has investments in uranium, gold, and other mineral resource and energy-related companies, including a direct interest in oil and gas explorations and an approximate 7% equity interest in Mega Uranium Ltd.

This news release contains forward-looking statements within the meaning of the "safe harbour" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties and other factors that may cause Brownstone's results to differ materially from expectations. These include risks relating to market fluctuations, property performance and other risks. These forward-looking statements speak only as of the date hereof. Brownstone disclaims any intent or obligation to update these forward-looking statements and cautions investors from placing undue reliance on forward-looking statements. Brownstone does have an ongoing obligation to disclose material information as it becomes available.


Contact Information

  • Brownstone Ventures Inc.
    Sheldon Inwentash
    President and C.E.O.
    (416) 941-8900