Centric Energy Corp.

Centric Energy Corp.

November 19, 2007 08:30 ET

Centric Energy Signs Mali Farm-Out Agreements With Heritage Oil

LONDON, ENGLAND--(Marketwire - Nov. 19, 2007) - Centric Energy Corp. (TSX VENTURE:CTE) -

- Centric Energy farms-out 75% interest in Blocks 7 & 11 to Heritage Oil Corporation.

- Heritage will fund all license costs for 2 years including 2D seismic acquisition and drilling of one well, and become operator.

- Heritage has been highly successful in the exploration and development onshore Republic of Congo (Brazzaville) and the geologically-similar Lake Albert Basin of Uganda.

- The farm-out to such an experienced company validates the exploration concept that led Centric Energy to acquire this acreage.

The Board of Centric Energy Corp. is pleased to announce it has entered into agreements to farm-out a 75 percent interest in its Block 7 and Block 11 oil and gas exploration concessions located in Mali, West Africa, to Heritage Oil Corporation (TSX:HOC). The farm-outs are subject to approval by the Mali Government and by the TSX Venture Exchange.

These farm-outs provide funding to cover the next two years of exploration and introduce an experienced and successful operator to this project in Mali.

Heritage Oil Corporation ("Heritage") is recognized as one of the most successful independent oil companies operating in Africa. Heritage, as 50% owner and operator of Blocks 3A and 1 in Uganda has been instrumental in the discovery of a new hydrocarbon system in the Lake Albert Basin, which has tremendous hydrocarbon potential. The Albert Basin bears many similarities to the Gao Graben of Mali where Centric's Blocks 7 and 11 are located. The last eight wells drilled by Heritage and its partner Tullow in the Albert Basin have all been successes, with the Kingfisher-1 well testing at a cumulative rate of 13,893 bopd. In addition, Heritage has been very successful in the Republic of the Congo. Its initial exploration work lead to the discovery of the M'Boundi oilfield, one of the very largest onshore oilfields in sub-Saharan Africa.

Heritage has an outstanding technical and management team who will now be able to apply their understanding of African interior-rift basin petroleum systems to the exploration of the Gao Graben. These farm-outs to such an experienced company validate the exploration concept that led Centric Energy to acquire these two Blocks in Mali through its acquisition of Mali Oil Development SARL.

Terms of the Farm-Out

Under the terms of the farm-outs, wholly owned subsidiaries of Heritage will earn a 75 percent interest in Blocks 7 and 11 in return for funding all costs of the obligatory work programs for the next two years in both Blocks. The obligations include the acquisition of 2D seismic in both Blocks at a minimum cost of US$5 million, seismic and geological interpretation, and the drilling of one well to a depth of at least 2000 metres for a minimum cost of US$8 million. The actual seismic and drilling costs are expected to be greater than these minimum spending obligations. Heritage will also take over the operatorship of the Blocks.


Alec Robinson, Centric Energy's President & CEO, says:

"This farm-out brings the expertise of a company that has been highly-successful in this type of geological province, into the exploration of Blocks 7 and 11 and, through this, into Mali. It will ensure the most rigorous and technically-capable exploration of the Blocks. In line with our strategy, it will help Centric Energy to balance the risk profile of its asset portfolio while focusing funds and management time on other ventures and on the evaluation and acquisition of new opportunities. Centric Energy Corp. is proud to be working with Heritage on the exploration of Mali Blocks 7 and 11."


Alec E. Robinson, President and CEO

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:

Statements in this release that are forward-looking statements are subject to various risks and uncertainties concerning the specific factors identified in Centric's periodic filings with Canadian Securities Regulators. Such forward-looking information represents management's best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially. Centric Energy Corp. does not assume the obligation to update any forward-looking statement except as required by applicable securities laws.

Cautionary Statement:

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

The TSX Venture Exchange does not accept responsibility for the adequacy or the accuracy of this release.

Contact Information

  • Centric Energy Corp.
    Brooke Coté
    Investor Relations
    Toll Free: 1-800-962-7189
    Website: www.centricenergy.com