Covenlina and Bandberg hold, through their subsidiaries, 25-year exploration and development licenses for the Tereshkinsky and Kikinsko-Gusikhinsky oil and gas properties in Russia.
The purchase price is payable with $6.9 million in cash and the remainder by the issuance of common shares of Crown at a deemed price of $1 per share. The transaction is expected to close on or before June 30, 2008.
Covenlina and Bandberg also hold a 25-year exploration and development license for the Krasnoarmeisky-2 property after exercising an outstanding option. The properties are located in the Saratov region of Russia, one of the major oil and gas regions in the country with advanced infrastructure and more than 60 years history of production.
The three properties combine for a total of approximately 500,000 acres. Extensive seismic work and analysis is scheduled for 2008, followed by exploration drilling in 2009.
