Pacific Rubiales Energy Corp. will invest $35 million (Can). to acquire controlling interest in CGX Energy Inc. in various transactions. Both are Toronto oil and gas companies.
Depending on the subscription of common shares and warrants, Pacific Rubiales will acquire 60-70% of CGX Energy compared with 35.06% previously.
Pacific Rubiales said the ascension of interest will enable it to deepen its investment in the highly prospective offshore Guyana oil play in South America.
“We consider CGX’s large acreage position in Guyana to be a premier, world class exploration asset in an offshore basin with analogous geology to West Africa, Brazil, and Venezuela.”
Net proceeds of the deal will enable CGX Energy to discharge its immediate obligations under its Georgetown PA Joint Operating Agreement and to continue to fund its other near-term obligations.
On closing, expected by Mar. 11, CGX Energy’s board will be reconstituted to ensure that a majority of the directors are nominees of Pacific Rubiales.