The company said the recent decline in the price of gold rendered its gold project in the Toodoggone region of northern British Columbia “uneconomic within the foreseeable future”.
As a result, the company’s board viewed an investment in the petroleum resource sector as “a more attractive alternative” for use of its funds.
Energex plans to acquire 100% of Realm Resources of Houston, Tex., an oil and gas company which has five oil and gas prospects valued at $7.3 million(US). The transaction is subject to due diligence by both Energex and Realm as well as regulatory and shareholder approval.
Energex will pay for the acquisition by issuing 11.9 million of its common shares to Realm Resources. At the closing of the deal, Energex will have about 29.89 million shares outstanding, of which Realm Resources will hold about 40%.
Arne Birkeland resigned as president of Energex and was replaced by Victor Bradley, a former director of Getty Resources.
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