DXI Energy Inc. (NYSE MKT:DXI)(TSX:DXI), an upstream oil and gas exploration and production company operating in Colorado’s Piceance Basin and the Peace River Arch region in British Columbia, today announced its strategic plan to expand production and improve operational efficiencies at its core Woodrush project in NEBC.
As previously reported, the Woodrush project currently includes 4 oil wells and 9 natural gas wells with significant processing facilities and in place pipeline to support further expansion. The Company owns a 99% working interest in these wells and is the project operator.
Given current commodity prices and through critical assessment of the half-way pools on the leasehold, the Company’s engineers have determined that there is a significant potential for oil production expansion by reconfiguration of waterflood operations and selective exploration. To address this opportunity and bolster the balance sheet of the Company, DXI plans to raise up to C$3 million via a non-brokered equity raise at a price of C$0.12 per share through the issuance of up to 25 million common shares. Insiders plan to purchase 25% of the proposed issue.
‘We are pleased to move forward with our strategic plan to expand oil production and build long-term sustainable operations in Canada. This represents a critical foundation step in our 2016 program as we continue to evaluate additional opportunities to further leverage our Canadian operations for long-term production and reserve growth,’ stated Robert Hodgkinson, CEO.
Under certain circumstances a fee of 7% may be paid to arms-length placement agents with respect to the non-insider participation.
The equity raise remains subject to approval of the Toronto Stock Exchange and NYSE MKT.
On May 26, 2016, the Company also received a letter from NYSE MKT LLC (‘NYSE MKT’ or the ‘Exchange’) stating that it is not in compliance with the continued listing standards as set forth in Section 1003(a)(ii) of the NYSE MKT Company Guide since it has reported net losses in three of its four most recent fiscal years. The Company’s ‘Plan of Compliance’ filed with NYSE MKT on April 18, 2016 to address a Section 1003 (a) (iii) deficiency as to minimum stockholders’ equity was accepted by NYSE MKT as filed on May 26, 2016. Accordingly, the Company has until September 17, 2017 to become compliant with both the Section 1003 (a) (ii) and (iii) continued listing standards. If the Company does not become compliant by this date, NYSE MKT will initiate delisting proceedings as appropriate, subject to standard Company appeal rights.
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