Canada Energy Partners has acquired all of the outstanding shares of Hudson's Hope Gas Ltd. (HHG), the wholly-owned subsidiary of GeoMet Inc. (GeoMet), which is the 50% owner and Operator of the Company's Peace River Coalbed Methane (CBM) Project, for a consideration of 2 million shares of the Company. The 2 million shares of the Company issued to GeoMet are subject to a 12-month hold period.
The Company believes this is a strategic acquisition for the following reasons: (1) The acquisition consolidates operations and 100% ownership of the CBM Project into the Company. (2) The acquisition adds approximately 230 BCF of CBM gas resource potential, bringing the CBM project total up to 500 BCF. This resource potential can only be commercialized under higher gas prices. (3) The acquisition secures 100% ownership of the Peace River gas plant, which is strategic to both the CBM and Montney Shale developments. (4) It solidifies ownership and control within the Company of the only water disposal wells within a 35-mile radius, which are strategic to both CBM and Montney Shale developments