CALGARY, AB--(Marketwired - September 22, 2016) -
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
Front Range Resources Ltd. ("Front Range" or the "Company") (TSX VENTURE: FRK) reports that it has closed its previously announced public offering of $20 million of common shares of the Corporation ("Common Shares") at a price of $0.70 per Common Share and Common Shares issued as "flow-through shares" within the meaning of the Income Tax Act (Canada) ("Flow-Through Shares") at a price of $0.81 per Flow-Through Share (the "Offering").
The Offering was led by Sprott Private Wealth LP and included GMP Securities L.P. (the "Agents"). The Agents received a cash commission equal to 5.0% of the gross proceeds raised under the Offering.
In conjunction with the closing of the Offering, the Company closed a non-brokered private placement of $2 million of Common Shares at a price of $0.70 per Common Share and Flow-Through Shares at a price of $0.81 per Flow-Through Share (the "Concurrent Private Placement"). The Common Shares and Flow-Through Shares issued in connection with the Concurrent Private Placement are subject to a statutory hold period until January 23, 2017, in accordance with applicable securities legislation.
A total of 21,428,571 Common Shares and 8,641,975 Flow-Through Shares were issued pursuant to the Offering and the Private Placement, resulting in there being 54,855,063 Common Shares issued and outstanding upon completion of the Offering and the Private Placement.
The gross proceeds from the sale of Flow-Through Shares issued pursuant to the Offering and the Concurrent Private Placement will be used by the Company, pursuant to the provisions of the Income Tax Act (Canada), to incur eligible Canadian exploration expenses ("Qualifying Expenditures") after the closing date and prior to December 31, 2017. The Company will renounce the Qualifying Expenditures to subscribers of the Flow-Through Shares for the year ended December 31, 2016.
The net proceeds from the Offering and the Concurrent Private Placement will be used by the Company to fund the drilling and completion of a 100% working interest Montney horizontal exploration well (the "3-23 Well") and a 100% working interest Montney horizontal development well (the "3-21 Well"), and for general working capital purposes. Both well locations are within the Company's 28-section (17,920 net acres) Pepper acreage block in West Central Alberta.
Front Range also reports that it has increased its 2016 capital budget to approximately $10 million. The 2016 capital expenditures will be directed towards the drilling and completion of the 3-23 Well.
A drilling licence has been obtained for the 3-23 Well and lease construction is underway. The 3-23 Well, with a projected total measured depth of approximately 6,000 metres at a true vertical depth of approximately 3,700 metres, is expected to spud mid October 2016, subject to rig availability and weather conditions. The 3-21 Well is expected to be drilled in the first quarter of 2017.
This news release does not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of any of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful, including any of the securities in the United States of America. The securities have not been and will not be registered under the United States Securities Act of 1933 (the "1933 Act") or any state securities laws and may not be offered or sold within the United States or to, or for account or benefit of, U.S. Persons (as defined in Regulation S under the 1933 Act) unless registered under the 1933 Act and applicable state securities laws, or an exemption from such registration requirements is available.
Further information relating to the Company is also available on its website at www.frrl.ca.
ADVISORY ON FORWARD-LOOKING STATEMENTS:
This press release contains forward-looking statements and forward-looking information (collectively "forward-looking statements") within the meaning of applicable securities laws. In particular and without limitation, this news release contains forward-looking statements concerning: the use of proceeds of the Offering and Concurrent Private Placement, the renunciation of Qualifying Expenditures, the Company's capital budget for 2016 and the timing of the drilling of the 3-23 Well and the 3-21 Well. Forward-looking statements typically uses words such as "anticipate", "believe", "project", "expect", "goal", "plan", "intend" or similar words suggesting future outcomes, statements that actions, events or conditions "may", "would", "could" or "will" be taken or occur in the future.
Forward-looking statements are based on a number of material factors, expectations or assumptions of the Company which have been used to develop such statements and information but which may prove to be incorrect, including the drilling of the 3-23 Well and the 3-21 Well and on the time frames contemplated. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, undue reliance should not be placed on them because the Company can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties, including but not limited to: failure to obtain, in a timely manner, regulatory, stock exchange and other required approvals in connection with the Financings. Additional information regarding some of these risks, expectations, assumptions and other factors may be found in the Company's Annual Information Form and Management's Discussion and Analysis prepared for the year ended December 31, 2015. The reader is cautioned not to place undue reliance on these forward-looking statements. The forward-looking statements contained in this news release are made as of the date hereof and the Company undertakes no obligations to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
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 NEWS RELEASE.