Canadian firm to acquire Bengkulu exploration block

Canadian firm Yonge Street Capital Corp. announced Thursday that it has entered into a letter of intent with Australian firm Endeavour Energy Ltd. to complete an arm's-length reverse take-over to acquire all of the shares of Endeavour Energy (Bengkulu) Pty Ltd (EEBPL), the interest holder of Bengkulu PSC exploration block onshore and offshore Sumatra.

The Proposed Transaction would result in Yonge Street and EEBPL combining pursuant to a reverse take-over transaction by an acquisition of EEBPL by Yonge Street from Endeavour. The resulting issuer would be renamed Kew Energy Limited.

The Proposed Transaction is conditional upon due diligence by each party, the raising of adequate financing for listing, regulatory and stock exchange approvals, the company said.

EEBPL owns a 100% working interest in the Bengkulu PSC, covering an area of 4,100 km2. Two prospects and one lead have been identified onshore as well as several more structures of interest offshore. The current work program is to drill 3 onshore wells in early 2010 and to identify offshore well locations to drill in 2011.

The PSC contract was awarded in October 2005. The exploration phase of the contract is 6 years, extendable to 10 years. If commercial production is developed, rights will extend to October 2035.

The independent report prepared on the Bengkulu PSC by Chapman Petroleum Engineering Ltd in July 2009 estimates an undiscounted risked value of US$311 million subject to probability estimates. (alex)