CGX Energy Inc.

CGX Energy Inc.

March 21, 2005 15:54 ET

CGX Announces Completion of $8.4 Million Financing


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: CGX ENERGY INC.

TSX VENTURE SYMBOL: OYL.U

MARCH 21, 2005 - 15:54 ET

CGX Announces Completion of $8.4 Million Financing

TORONTO, ONTARIO--(CCNMatthews - March 21, 2005) - CGX Energy Inc. (TSX
VENTURE:OYL.U) is pleased to announce the completion of a previously
announced non-brokered private placement. The original announcement was
for a $5 million private placement, however the issue was significantly
oversubscribed and was closed at $8,412,000. CGX has issued a total of
10,515,000 units at a price of US$0.80 per unit to raise gross proceeds
of US$8,412,000. Each unit consists of one common share and one-half
common share purchase warrant. Each full warrant entitles the holder to
purchase an additional common share at a price of US$1.10 for a period
of 18 months until September 21, 2006.The shares issued under the
private placement are subject to a four-month hold period. After this
financing, CGX Energy's issued capital consists of 93,005,595 common
shares and 109,434,913 common shares on a fully-diluted basis.

Of the 10,515,000 units issued, 6,250,000 units were purchased by Sprott
Asset Management on behalf of various funds that it manages. When
combined with prior purchases, Sprott Asset Management will hold 12.4%
of the outstanding shares of CGX. With respect to the private placement,
Fort House Inc. was paid a cash commission and broker warrants
exchangeable into 322,500 common shares at US$0.80 for a portion of the
financing. In addition, GMP Securities Ltd. was paid a cash fee for
financial advisory services with respect to the offering.

Kerry Sully, President & CEO of CGX stated, "This financing will allow
us to advance our exploration offshore Guyana, where exploration to the
east and west of our concessions has intensified over the last 6 months.
To the northwest, exploration by ChevronTexaco and ConocoPhillips on the
Deltana Platform offshore Venezuela is reported in the press to have
discovered more than 5 trillion cubic feet of gas. Also on the Deltana
Platform Statoil and TOTAL are conducting a multi-well exploration
program. To the southeast, offshore Suriname, three seismic programs
totalling 13,000 kilometres have just been completed by Repsol-YPF,
Maersk and Staatsolie respectively."

"Within our Corentyne Concession, where we had previously identified our
Eagle and Wishbone targets, we have undertaken extensive
re-interpretation of the solid-state 2D seismic data we had shot in
1999. Depth-to-time reprocessing has significantly enhanced our
understanding of the basin. This has led to state-of-the-art tomography
reprocessing, which although expensive, reinforces and adds to all prior
interpretations."

"Within our Pomeroon Concession, in December we acquired seismic data
that had been shot in 1991-93. Although of older vintage than our
Corentyne data, we are applying recent processing technology to this
data to define the potential of Pomeroon, which is in the East Venezuela
Basin."

Activity offshore Guyana has slowed while maritime borders are being
resolved. In this regard, Guyana has opted to proceed through peaceful
diplomacy. On February 22, 2005 the Government of Guyana filed its
Memorial to present its case under the binding dispute settlement
procedures under the United Nations Convention on the Law of the Sea
(UNCLOS) in relation to the maritime dispute between Guyana and
Suriname. CGX has funded a significant portion of Guyana's legal expense
to prepare its case. The full process is scheduled to take approximately
another two years. With respect to the Venezuela border the Good Officer
process of the United Nations Secretary General is continuing.

"With respect to the our onshore drilling program, four of our locations
are prepared and received only modest erosion in the recent flood of the
century in Guyana," stated Warren Workman, Vice President of CGX and
President of ON Energy Inc., CGX's 62% owned subsidiary in Guyana. "Our
onshore concessions in Guyana are held by ON, where our minimum work
commitment of aeromag, geochemical surveys and 2D seismic was completed
2 years ahead of schedule. We are prepared to commence drilling as soon
as our contracted rig is released from its location in Trinidad. CGX
will announce when the rig is released for delivery to Guyana."

CGX Energy Inc. (TSX VENTURE:OYL.U) is a Canadian-based oil and gas
exploration company focused on the exploration for oil in the Guyana
basin and is actively looking at other international opportunities. CGX
is managed by a team of experienced oil and gas and finance
professionals from Canada, U.S.A. and the UK. CGX is financed
internationally and has shareholders worldwide.

THIS PRESS RELEASE WAS PREPARED BY CGX ENERGY INC., WHICH ACCEPTS THE
RESPONSIBILITY AS TO ITS ACCURACY. THE TSX VENTURE EXCHANGE DOES NOT
ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

STATEMENTS IN THIS PRESS RELEASE REGARDING THE COMPANY'S BUSINESS WHICH
ARE NOT HISTORICAL FACTS ARE "FORWARD-LOOKING STATEMENTS" THAT INVOLVE
RISKS AND UNCERTAINTIES, SUCH AS ESTIMATES AND STATEMENTS THAT DESCRIBE
THE COMPANY'S FUTURE PLANS, OBJECTIVES OR GOALS, INCLUDING WORDS TO THE
EFFECT THAT THE COMPANY OR MANAGEMENT EXPECTS A STATED CONDITION OR
RESULT TO OCCUR. SINCE FORWARD-LOOKING STATEMENTS ADDRESS FUTURE EVENTS
AND CONDITIONS, BY THEIR VERY NATURE, THEY INVOLVE INHERENT RISKS AND
UNCERTAINTIES. ACTUAL RESULTS IN EACH CASE COULD DIFFER MATERIALLY FROM
THOSE CURRENTLY ANTICIPATED IN SUCH STATEMENTS.

Shares Outstanding: 93,005,595

Fully-Diluted: 109,112,413



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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    CGX Energy Inc.
    Kerry Sully
    President & CEO
    (604) 733-9647
    or
    CGX Energy Inc.
    Charlotte May
    Investor Relations
    (416) 364-3353
    or
    CGX Energy Inc.
    Denis Clement
    Director
    (416) 364-1909
    (416) 364-5400 (FAX)
    www.cgxenergy.com