VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 9, 2012) - New Zealand Energy Corp. (TSX VENTURE:NZ)(OTCQX:NZERF) is pleased to announce that the Company and its wholly-owned subsidiary, NZEC Wairoa Limited (collectively "NZEC"), have entered into a binding agreement with Westech Energy New Zealand ("Westech"), a wholly-owned subsidiary of Energy Corporation of America. Pursuant to the terms of the agreement, NZEC will enter into a joint venture agreement with Westech whereby NZEC can acquire 80% ownership and become the operator of Petroleum Exploration Permit 38346, covering 267,862 acres (1,084 km2) in the East Coast Basin of New Zealand's north island.
In consideration for the transfer of the 80% interest, NZEC will immediately assume 100% responsibility for the permit and completion of the related work program and will pay Westech US$725,000. Upon completion of the related work program, Westech will refund US$225,000 to NZEC and all future expenditures for the permit will be funded 80% by NZEC and 20% by Westech. Transfer of the 80% ownership and operatorship of the permit, formation of the joint venture, and proposed amendments to the work program are subject to approval by New Zealand Petroleum & Minerals.
The proposed work program requires NZEC to complete various technical studies, reinterpret existing seismic data, shoot and interpret additional 2D seismic, and drill two exploration wells by March 2016. NZEC has the option to withdraw from the joint venture after drilling the first exploration well, in which case it would transfer ownership and operatorship of the permit back to Westech.
"With PEP 38346 in our portfolio, NZEC will hold more than 2 million net acres (including pending permits) in the East Coast Basin from which to unlock the potential of New Zealand's oil shale formations," said John Proust, Chief Executive Officer and Director of NZEC. Ian Brown, NZEC's Chief Operating Officer, added, "This is a property that NZEC's technical team knows well from previous consulting work in the area, and we have an excellent relationship with the local community. NZEC looks forward to working with Westech to advance this exciting exploration opportunity."
On behalf of the Board of Directors
John Proust, Chief Executive Officer & Director
About New Zealand Energy Corp.
NZEC is an oil and natural gas company engaged in the production, development and exploration of petroleum and natural gas assets in New Zealand. NZEC's property portfolio collectively covers approximately 2.25 million acres (including pending permits) of conventional and unconventional prospects in the Taranaki Basin and East Coast Basin of New Zealand's North Island. The Company's management team has extensive experience exploring and developing oil and natural gas fields in New Zealand and Canada, and takes a multi-disciplinary approach to value creation with a track record of successful discoveries. NZEC plans to add shareholder value by executing a technically disciplined exploration and development program focused on the onshore and offshore oil and natural gas resources in the politically and fiscally stable country of New Zealand. NZEC is listed on the TSX Venture Exchange under the symbol NZ and on the OTCQX International under the symbol NZERF. More information is available at www.newzealandenergy.com or by emailing email@example.com.
This news release contains certain forward-looking information and forward-looking statements within the meaning of applicable securities legislation (collectively "forward-looking statements"). The use of any of the words "will", "become", "proposed" and similar expressions are intended to identify forward-looking statements. These 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, including without limitation, the requirement for New Zealand Petroleum & Minerals approval of the joint venture with Westech and transfer of 80% ownership to NZEC; the need to obtain government approval of proposed changes to the PEP 38346 work program before exploring the property; NZEC's ability to execute the PEP 38346 work program on time or at all; the speculative nature of exploration, appraisal and development of oil and natural gas properties; changes in the cost of exploration and development of oil and gas properties, including costs of extracting and delivering oil and natural gas to market, that affect potential profitability of oil and natural gas exploration; the need to obtain various approvals before exploring and producing oil and natural gas resources; uncertainty in the timing of receipt of permits and the Company's ability to extend the permits if required; exploration hazards and risks inherent in oil and natural gas exploration; market conditions that prevent the Company from raising the funds necessary for exploration and development on acceptable terms or at all; global financial market events that cause significant volatility in commodity prices; unexpected costs or liabilities for environmental matters; competition for, among other things, capital, acquisitions of resources, skilled personnel, and access to equipment and services required for exploration, development and production; changes in exchange rates, laws of New Zealand or laws of Canada affecting foreign trade, taxation and investment; failure to realize the anticipated benefits of acquisitions; and other factors as disclosed in documents released by NZEC as part of its continuous disclosure obligations. NZEC believes the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct. Such forward-looking statements included in this news release should not be unduly relied upon. These statements speak only as of the date of this news release and NZEC does not undertake to update any forward-looking statements that are contained in this news release, except in accordance with applicable securities laws.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as such term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.