Petroteq Energy Inc., an integrated oil ?company focused on the development and implementation of its proprietary oil-?extraction technologies, announced that assays of oil sands samples taken during a recent survey of the Petroteq lease properties have now been completed.
As reported on October 29, 2020, a recent survey of the Petroteq lease properties identified three key areas where the oil sands ore appeared to have higher oil saturations than what was previously mined. Samples were taken from each location and lab assays of the samples have now been completed. The areas sampled show very rich oil saturations ranging from 14 to 18 per cent by weight. Ore having an oil saturation of 14 per cent contains roughly 0.8 barrels of bitumen per ton of ore. The area from which the samples were taken is estimated to contain approximately 60-70,000 tons of mineable ore, which is expected to be sufficient to feed the Company's oil sands plant at Asphalt Ridge (the "POSP") for over three months at a production rate of 400-500 barrels per day. These areas will be the focus of mining efforts during the initial operation of the POSP following its pending restart.
Planning is underway for the Company to drill and core at six locations on the lease during November. This is expected to allow Petroteq's mining consultant to develop an expanded and detailed mining plan which will direct future mining operations for continued plant operations once the areas described above have been mined and processed.
George Stapleton, Petroteq COO, commented "We have so far been able to remain mostly on schedule and are still on track to begin starting up the POSP in late November. The assays of our oil sands samples exceeded expectations and have confirmed the areas where we will concentrate our initial mining efforts after the restart of the POSP. Because we will be able to extract more bitumen per ton of ore than our earlier estimates, we will need to mine less tonnage per barrel, thereby reducing our mining cost per barrel and, by extension, POSP operating expenses."
The Company also announces the issuance of a US$500,000 principal amount secured convertible note (the "Note") to an arm's length lender. The Note is convertible into units of the Company at US$0.0562 per unit with each unit consisting of one common share of the ?Company and one warrant. Each warrant would entitle ?the holder thereof to acquire one common share of the Company at an exercise price of US$0.0562 per share until 60 months from the issuance ?of the Note.? The Note and the securities issuable under the Note are and will be issued in reliance on exemptions from the registration requirements of the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), and applicable state securities laws, and will be issued as "restricted securities" (as defined in Rule 144 under the U.S. Securities Act). In addition, the Note and the securities issuable under the Note are subject to a Canadian four-month hold period.