SOURCE: Terra Nova Minerals Inc.
CALGARY, AB--(Marketwire - Jul 17, 2012) - Terra Nova Minerals Inc. (TSX VENTURE: TGC), through its wholly owned subsidiary, Terra Nova Energy (Australia) Pty. Ltd. ("Terra Nova" or the "Corporation"), is pleased to announce that it has signed an agreement with Geokinetics (Australia) Pty. Ltd. ("Geokinetics") of Brisbane, Australia whereby Geokinetics will complete a 127 square kilometre three dimensional ("3D") seismic survey on the northern boundary of Petroleum Exploration License ("PEL") 112 (comprised of 2196 sq kms) on the western flank of the Cooper Eromanga Basin in South Australia. The survey is expected to commence early August 2012 and will include the shooting and processing of the 3D data acquired. Crews are currently in the field completing line clearing and survey work. The 3D program is anticipated to cost up to AUS$3.7 million, and is expected to take up to 120 days to complete. The survey will identify potential multi-zone drilling targets including the Namur, Hutton and Birkhead shale down to 7000 feet.
Terra Nova has over 400 kms of existing two dimensional ("2D") seismic on PEL 112 and has identified over 27 leads having potential drilling locations. Terra Nova's geologists and geophysicists have isolated and high-graded 12 of the 27 leads that will be the focus of the Geokinetics 3D survey, of which four are currently considered drillable.
The 3D seismic survey on PEL 112 marks the first step for Terra Nova in fulfilling its obligations under the agreement with Holloman Energy Corporation et al dated effective May 11, 2012 (the "Definitive Agreement") whereby Terra Nova may earn up to a 55% working interest in PEL112 and PEL 444 in South Australia (collectively, the "Licenses" or "PELs"). Upon completing the 3D survey, Terra Nova will earn a 20% working interest in PEL 112.
In accordance with the agreement with Geokinetics, Terra Nova may opt to have Geokinetics shoot a similar 3D seismic survey on PEL 444 (comprised of 2358 sq kms) which, upon completion, will earn Terra Nova a 20% working interest in PEL 444. The PEL 444 survey is anticipated to commence in late October 2012.
Terra Nova has the right under the Definitive Agreement to earn an additional 35% working interest in both Licenses by drilling six wells in the area of the Licenses (provided at least one well is drilled on each PEL). Each well drilled will earn Terra Nova an additional 5.8333% working interest in both PELs. Further, in accordance with the terms of the Definitive Agreement, Terra Nova is entitled to a preferential recovery of 100% of its costs to drill and test a successful well, and will receive an 80% interest in the oil produced by such well. The Corporation is currently investigating the availability of drilling rigs in order to drill the first three wells.
The leads on PEL 112 and PEL 444 are currently defined by over 650 kms 2D seismic data acquired from South Australia government sources and from Holloman Energy Corporation. Terra Nova's management and technical staff are of the view that the Licenses are highly prospective for the discovery of oil and on trend with several discoveries made in the area.
Forward looking information
This news release contains forward-looking information relating to the Corporation's intentions to conduct the seismic program and subsequent drilling programs and other statements that are not historical facts. More particularly, this news release contains statements concerning steps to be taken by Terra Nova to conduct the seismic program and to earn the 55% working interest in the Licenses. Such forward-looking information is subject to important risks, uncertainties and assumptions that could cause actual results to differ materially from what is currently expected, for example: risks related to oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, competition from other producers, inability to retain drilling rigs and other services, reliance on key personnel, and insurance risks.
You should not place undue importance on forward-looking information and should not rely upon this information as of any other date. While the Corporation may elect to, the Corporation is under no obligation and does not undertake to update this information at any particular time, except as required by law.
This news release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any state in the United States in which such offer, solicitation or sale would be unlawful. The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.
About Terra Nova Minerals Inc.
Terra Nova Minerals Inc. is a Calgary based oil and gas company. Its common shares trade on the TSX Venture Exchange under the symbol "TGC".
Neither the 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 release.