CALGARY, ALBERTA--(Marketwire - Dec. 6, 2012) - Bayshore Petroleum Corp. (TSX VENTURE:BSH) ("Bayshore" or the "Corporation") is pleased to announce it has entered into a Memorandum of Understanding with a private oil/gas company operating in Saskatchewan pursuant to which Bayshore will construct a small-scale heavy oil upgrading facility utilizing a proprietary cold catalytic cracking ("CCC") process. The pilot project, to be located in the Meota area of Saskatchewan, is expected to initially process and upgrade 350 barrels of heavy oil (10° API) per day from the Meota field into diesel-quality oil, synthetic gas and coke. The upgrader will be constructed to permit input capacity expansion to 1,000 barrels of heavy oil per day in conjunction with the field development plan. Under the proposed arrangement, Bayshore will purchase the heavy oil directly from the private oil/gas company and/or other sources in the area. The upgrader is expected to demonstrate the commercial viability of the CCC process following successful laboratory tests conducted by Bayshore using heavy crude obtained from the area. In the laboratory tests the CCC process yielded vehicle-quality diesel in a normal pressure and low temperature environment using a proprietary catalyst. Further laboratory tests are required to determine the pilot plant's operating parameters and flow processes.
In addition, under the same Memorandum of Understanding, Bayshore will have an option until July 31, 2013, to purchase up to 50% of the exploratory/development heavy oil acreage in Meota area owned by the private company at a price agreeable to both parties. Total acreage in the area owned by the private company is 9,600 acres.
The Memorandum of Understanding contemplates the execution of formal agreements following further negotiation and finalization of terms and conditions.
Bayshore is a Calgary, Alberta based corporation engaged in the exploration, development and production of petroleum and natural gas. The Common Shares are listed on the TSX Venture Exchange under the trading symbol "BSH".
Cautionary Statements
Statements in this press release may contain forward-looking information including expectations of future production, operating costs, commodity prices, administrative costs, commodity price risk management activity, acquisitions and dispositions, capital spending, access to credit facilities, income taxes, regulatory changes, and other components of cash flow and earnings. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the company. These risks include, but are not limited to, the risks associated with the mining industry, commodity prices and exchange rate changes. Industry related risks could include, but are not limited to, operational risks in exploration, development and production, delays or changes in plans, risks associated to the uncertainty of reserve estimates, health and safety risks and the uncertainty of estimates and projections of production, costs and expenses. The reader is cautioned not to place undue reliance on this forward-looking information.
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Contact Information:
Peter Ho
President and Chief Executive Officer
(403) 265-8820