Oil Optimization Inc.
TSX VENTURE : OOI

Oil Optimization Inc.

May 16, 2013 08:30 ET

Oil Optimization Announces Expiry of Well Program Option Under Block L14/50 Farm-in Agreement and Retention Bonus Share Issuance to Certain Executives

CALGARY, ALBERTA--(Marketwired - May 16, 2013) - Oil Optimization Inc. (TSX VENTURE:OOI) ("OOI" or the "Company") today announced the expiry of the option (the "Well Program Option") to complete a well program (the "Well Program") on Block L14/50, previously granted by OOI to Rockstone Petroleum Limited ("Rockstone") pursuant to the terms and conditions of a farm‐in agreement (the "Farm‐in Agreement") dated August 14, 2012 between OOI, Rockstone and certain other affiliated parties.

In accordance with the terms and conditions of the Well Program Option, Rockstone had the option to acquire an additional 35% working interest in Block L14/50 in exchange for committing to fund the Well Program to a maximum cost of US$1,500,000. As Rockstone did not make an election prior to the expiry of the deadline provided under the Farm‐in Agreement, the Well Program Option has expired in accordance with its terms.

Luc Desmarais, the President and Chief Executive Officer of the Company, stated: "While the parties endeavoured in good faith to complete the proposed Well Program, final agreement could not be reached with respect to this program. We continue to believe in the strength of our seismic data, as evidenced by the interest shown in the Block by other third parties, and look forward to working with Rockstone, as OOI's minority joint venture partner, to further explore and develop the north Phetchabun basin."

As at the date hereof, Rockstone has earned a 22% working interest in Block L14/50. Under the terms of the Farm‐in Agreement, Rockstone has an obligation to make a one‐time cash payment of US$100,000 to OOI on or before the 10th day following the expiry of the Well Program Option in exchange for earning an additional 3% working interest in the Block. Thereafter, the parties have agreed to finalize and execute a joint operating agreement, in substantially the form agreed to in the Farm‐in Agreement, which will govern all future operations on Block L14/50 and pursuant to which the parties will agree to share the costs of any further work programs based on their pro rata share in the Block. OOI's wholly‐owned subsidiary, JSX Energy Holdings Limited, through its local branch office in Thailand, will continue to act as operator in respect of the Block.

The Company also announced that it has issued 150,000 common shares of the Company, at a deemed issuance price of $0.05 per share, to each of Messrs. Chris Serin and Darren Steffes, respectively the Chief Financial Officer and the Vice President, Exploration of the Company, as a retention bonus. Such common shares are subject to a hold period of four months and one day in accordance with applicable securities laws.

Forward‐Looking Statements

This news release may contain forward‐looking statements and forward‐looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward‐looking information or statements. More particularly and without limitation, this news release contains forward‐looking statements and information concerning the expected activities of Oil Optimization. The forward‐looking statements and information are based on certain key expectations and assumptions made by Oil Optimization. Although Oil Optimization believes that the expectations and assumptions on which such forward‐looking statements and information are based are reasonable, undue reliance should not be placed on the forward looking statements and information because Oil Optimization can give no assurance that they will prove to be correct. By its nature, such forward‐looking information is subject to various risks and uncertainties, which could cause the actual results and expectations to differ materially from the anticipated results or expectations expressed. Readers are cautioned not to place undue reliance on this forward‐looking information, which is given as of the date hereof, and to not use such forward‐looking information for anything other than its intended purpose. Oil Optimization undertakes no obligation to update publicly or revise any forward‐looking information, whether as a result of new information, future events or otherwise, except as required by law.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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