Canoel International Energy Ltd.

Canoel International Energy Ltd.

January 25, 2011 08:30 ET

Canoel Announces New Developments

CALGARY, ALBERTA--(Marketwire - Jan. 25, 2011) -

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Canoel International Energy Ltd. ("Canoel" or the "Company") (TSX VENTURE:CIL) is pleased to announce that it has obtained a loan from a private lender for the amount of USD $ 2,000,000. The loan is for a period of two years, extendable for an additional six months under certain circumstances. The loan is initially unsecured and bears an interest fixed at US prime plus 6.75% payable quarterly. The Company has agreed to grant securities over additional oil and gas assets acquired in Argentina, if any, once acquired, using the loan proceeds. Subject to regulatory approval, the lender has the right to participate in a portion of the profits from the eventual sale of any such property. Canoel maintains a strategy to buy oil & gas properties in Argentina and this financing will strengthen its chances.

The Company is also pleased to announce that it has commenced a workover program in Argentina designed to enhance the productivity of the Don Alberto and Don Ernesto fields. Due to the shortage of available service rigs and persistent delays in obtaining such services, Canoel is also considering the potential acquisition of one service rig. This would ensure that the Company can perform required workovers on a timely basis and will also allow Canoel to perform similar services for other local producers therefore generating additional revenues.

In Italy, the Company has participated in an auction of producing and shut-in gas properties organized by the Italian Ministry of Economic Development. Canoel has been notified that it is one of the companies which have been tentatively approved for the final selection. There can be no assurance that the Company will be awarded any licences but, in expectation of a favourable outcome from this auction and in line with the Company's future plans, management has established a new Italian subsidiary named Canoel Italia S.r.l.

Andrea Cattaneo, President & CEO of the Company said: "This financing strengthens Canoel's ability to acquire additional producing properties currently being considered as well as oil & gas permits with exploratory and development potential."

Neither 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 release.

Contact Information

  • Canoel International Energy Ltd.
    Andrea Cattaneo
    Chief Executive Officer and President
    (403) 938 8154
    (403) 775 4474 (FAX)
    Canoel International Energy Ltd.
    Jose Ramon Lopez-Portillo
    (403) 938 8154
    (403) 775 4474 (FAX)