Avila Energy Corporation (CSE: VIK) ('Avila' or the 'Company') is pleased to announce the results of its Independent Reserves Evaluation and the Acquisition Completed November 1st, 2022, in East Central Alberta.
The Company's independent reserves evaluation (the 'Evaluation), which was completed by Deloitte LLP, the Company's Qualified Reserve Evaluator ('Deloitte' or 'QRE') of Calgary, Alberta, which was conducted in accordance with the definitions, standards and procedures contained in the Canadian Oil and Gas Evaluators Handbook ('COGEH') and National Instrument 51-101 - Standards for Disclosure of Oil and Gas Activities ('NI 51-101'). The reserve volumes are inclusive of 100% of the Company's recent and acquisitions and represents the corporate reserve volumes as of January 1, 2023.
Reserves Highlights
Avila Energy's reserves on a Proven + Probable basis (2P) for the Company is 5,256,100 BOE valued at $30.734 million future cash flows based on a net present value discounted 10% before income taxes (NPV10% BT). The $30.734 million is an estimate of future cash flows and do not necessarily represent fair market value and is supported by a sustainable capital program of CAD $10.432 million for proved reserves and CAD $17.517 million for proved plus probable reserves.
Upon the deliver of the evaluation and taking into consideration the condition of the assets and the facilities at the time of the acquisition was recorded as follows.
On November 1, 2022, the Company acquired 100% interest in oil and gas properties in East Central Alberta the Donalda Area. The transaction was accounted for as business combination under IFRS 3 - 'Business Combinations' as the assets met the definition of a business. The total purchase is comprised of $1,800,000 in the form of a promissory note.
The following purchase price allocation is based on management's best estimate of the fair value assigned to the Assets acquired and the liabilities assumed. Management determined the fair value of the oil and gas properties to be $11,007,129, which was based on the NPV of 10% discounted cash flows created by an independent QRE. The assumption of $981,744 in discounted decommissioning liabilities and asset retirement obligation was based on the future value of $3,772,618, an inflation rate of 2.0%, credit adjusted risk free rate of 5.39% and life of the asset of 9 to 50 years.
Best, estimates were determined based on available information at the time of preparation of these Financial Statements. The Company continued its review to determine the identification of intangible assets, assumption of liabilities, identification of contingent liabilities and working capital adjustments during the allowable measurement period, which shall not exceed one year from the Closing.
Acquisition Cost
The Company did not incur any acquisition cost.
Revenue and operating income
The acquisition contributed $874,852 in revenue, royalty expense of $84,916 and $560,070 in direct operating expenses, in the two months, from November 1 to December 31, 2022, resulting in $229,866 of net operating income.
About, Avila Energy Corporation (CSE:VIK) ('Avila' or the 'Company')
The Company is an emerging CSE listed corporation trading under the symbol ('VIK'), and in combination with an expanding portfolio of 100% Owned and Operated oil and natural gas production, pipelines and facilities is a licensed producer, explorer, and developer of energy in Canada. The Company, through the implementation of a closed system of carbon capture and sequestration anticipated to be approved for construction in 2024 and an established path underway towards the material reduction of Tier 1, Tier 2, and Tier 3 emissions, continues to work towards becoming a Vertically Integrated low-cost Carbon Neutral Energy Producer. The Company continues to grow and achieve its results by focusing on the application of a combination of proven geological, geophysical, engineering, and production techniques.
Contact:
Email: peter@intuitiveaustralia.com.au
Cautionary and Forward-Looking Statements
Certain information set forth in this news release contains 'forward-looking statements' with respect to the proposed business combination between the Company and IAC. Forward-looking statements may generally be identified by the use of words such as 'believe,' 'may,' 'will,' 'estimate,' 'continue,' 'anticipate,' 'intend,' 'expect,' 'should,' 'would,' 'plan,' 'project,' 'forecast,' 'predict,' 'potential,' 'seem,' 'seek,' 'future,' 'outlook,' 'target' or other similar expressions (or the negative versions of such words or expressions) that predict or indicate future events or trends or that are not statements of historical matters. Forward-looking statements are predictions, projections, and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties that could cause the actual results to differ materially from the expected results. These statements are based on various assumptions, whether or not identified in this communication. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as and must not be relied on by an investor as, a guarantee, an assurance, a prediction, or a definitive statement of fact or probability. Many actual events and circumstances are beyond the control of the Company and IAC.
All statements in this news release, other than statements of historical facts, that address events or developments that the Company expects to occur, are forward-looking statements, including, but not limited to entrance into a Business Combination Agreement, the occurrence of and the anticipated date of closing of the Transaction, the availability of financing for the Transaction and IAC at the time of signing, the anticipated price per share post-closing of the Transaction, and the post-Closing governance of the Resulting Company. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond the Company's and IAC's control, including completion of customary due diligence with respect to the Transaction, negotiation of the definitive documentation including the Business Combination Agreement, approval of the Transaction by Company and IAC shareholders, approval by the IAC shareholders of an extension of the time by which they must consummate an initial business combination, listing approval by a United States exchange and the impact of general economic conditions, industry conditions, the regulatory environment, volatility of commodity prices, currency fluctuations, environmental risks, operational risks, competition from other industry participants and stock market volatility. Although the Company and IAC believe that the expectations in its forward-looking statements are reasonable, its forward-looking statements have been based on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and assumptions are based upon currently available information. Such statements are subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated, or implied in the forward-looking statements. Accordingly, readers are cautioned not to place undue reliance on the forward-looking statements, as no assurance can be provided as to future results, levels of activity or achievements. Risks, uncertainties, material assumptions and other factors that could affect actual results are discussed in the Company's public disclosure documents available at www.sedar.com and IAC's public disclosure documents available through the EDGAR filing system at www.sec.gov. Furthermore, the forward-looking statements contained in this document are made as of the date of this document and, except as required by pplicable law, neither the Company nor IAC undertake any obligation to publicly update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement.
AVILA ENERGY CORPORATION 
