Centric Energy Corp.
TSX VENTURE : CTE

Centric Energy Corp.

January 26, 2011 11:14 ET

Centric Energy Closes Farmout of Kenya Block 10BA to Tullow Oil

LONDON, ENGLAND--(Marketwire - Jan. 26, 2011) - Centric Energy Corp. ("Centric Energy" or "the Company") (TSX VENTURE:CTE) is pleased to advise that the Company and Tullow Kenya B.V. ("Tullow") (LSE:TLW) have closed the farm-in agreement whereby Tullow is farming-in to a 50 per cent participating interest in Centric Energy (Kenya)'s 100 per cent owned Production Sharing Contract covering Block 10BA in north-western Kenya (the "PSC").

Tullow has paid a closing consideration of US$961,000 in respect of estimated historic costs related to acquisition of the PSC and exploration of Block 10BA, subject to a post-closing audit. Tullow will also fund 80 per cent of future joint venture expenditures in the Block until total spending reaches US$30 million, after which Centric Energy will be responsible for its working interest share of future costs.

Pursuant to the farmout, Tullow will also assume operatorship of the Block.

Block 10BA is strategically located within the East African Rift System which is enjoying increasing exploration interest and significant recent success, most notably in the Albertine rift in Uganda, 660 km to the west, which is considered to be the closest geological analog to the Tertiary basins underlying Block 10BA (source: Gustavson Associates, "Resource Evaluation Report, Centric Energy Corporation, Kenya Block 10BA", dated January 1, 2010). Major volumes of hydrocarbons have been discovered by Tullow Oil in the Albertine rift, currently estimated (P50) to be approximately 1000 million barrels of oil as stated in Tullow's half yearly report dated August 2010. The referenced report by Gustavson Associates estimates the P50 unrisked prospective resources*1 of Block 10BA to be 2.2 billion BOE*2.

"We are very pleased to be working with Tullow on the exploration of Block 10BA," says Alec Robinson, Centric Energy's President and CEO. "Tullow's technical expertise, and their experience in the successful exploration of the analogous Albertine basin, will ensure that Block 10BA is explored in the most rigorous manner. Tullow's outstanding record of environmental stewardship in Lake Albert will also mean that the environmentally-sensitive Lake Turkana will be safeguarded."

ON BEHALF OF CENTRIC ENERGY CORP.

Alec Robinson, President and Chief Executive Officer

*1 Prospective resources are defined as "those quantities of oil and gas estimated on a given date to be potentially recoverable from undiscovered accumulations. They are technically viable and economic to recover." Note that the estimated prospective resources disclosed in this news release could be oil or gas and that the estimate does not include consideration for the risk of failure in exploring for these resources. There is no certainty that any portion of the resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the resources.

*2 BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 MCF : 1 bbl is based on energy equivalency conversion method primarily applicable at the burner tip and does not represent value equivalency at the wellhead.

This News Release does not constitute an offer to sell or a solicitation of an offer to sell any securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to a U.S. Person unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

FORWARD-LOOKING STATEMENTS

Certain statements made and information contained herein constitute "forward-looking information" (within the meaning of applicable Canadian securities legislation). Such statements and information (together, "forward looking statements") relate to future events or the Company's future performance, business prospects or opportunities. Forward-looking statements include, but are not limited to, statements with respect to estimates of reserves and or resources, future production levels, future capital expenditures and their allocation to exploration and development activities, future drilling and other exploration and development activities, ultimate recovery of reserves or resources and dates by which certain areas will be explored, developed or reach expected operating capacity, that are based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management.

All statements other than statements of historical fact may be forward-looking statements. Statements concerning proven and probable reserves and resource estimates may also be deemed to constitute forward-looking statements and reflect conclusions that are based on certain assumptions that the reserves and resources can be economically exploited. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as "seek", "anticipate", "plan", "continue", "estimate", "expect, "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe" and similar expressions) are not statements of historical fact and may be "forward-looking statements". Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. The Company believes that the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon.

The Company does not intend, and does not assume any obligation, to update these forward-looking statements, except as required by applicable laws. These forward-looking statements involve risks and uncertainties relating to, among other things, changes in oil prices, results of exploration and development activities, uninsured risks, regulatory changes, defects in title, availability of materials and equipment, timeliness of government or other regulatory approvals, actual performance of facilities, availability of financing on reasonable terms, availability of third party service providers, equipment and processes relative to specifications and expectations and unanticipated environmental impacts on operations. Actual results may differ materially from those expressed or implied by such forward-looking statements.

Neither the TSX Venture Exchange nor its Regulation Services Provider accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Centric Energy Corp.
    Alec E. Robinson
    Toll Free: +1 (800) 962-7189 or +44 207 222 8512
    Mobile: +44 (0)793 040 5550
    www.centricenergy.com