VANCOUVER, BRITISH COLUMBIA--(Marketwired - April 8, 2016) - Canada Energy Partners Inc. (the "Company") is pleased to announce that as a result of a number of strategic milestones, the Board of Directors has refocused its business strategy, allowing the Company to concentrate on advancing its promising jet cavitation technology.


  • Strategic focus on advancing and commercializing the jet cavitation technology
  • Significant interest in jet cavitation technology for coalbed methane exploration in China
  • Expanded treasury by $550,000 through sale of Peace River gas plant and associated equipment
  • Decision to plug and abandon the Peace River coalbed methane project

Jet Cavitation Technology

For three years the Company has been researching and designing a jet cavitation tool that has the potential to revolutionize certain aspects of the coalbed methane ("CBM"), diamond mining and potash mining sectors. The jet cavitation technology was developed by the Company primarily to excavate cavities in subsurface coal seams for the dual purpose of producing commercial quantities of coal via a wellbore and stimulating the production of natural gas from coal seams. The Company believes this technology can also be applied to the extraction of other resources such as diamonds and potash.

The jet cavitation tool is able to access resources that, due to size, depth or concentration, are beyond the economic reach of conventional mining techniques. The tool accesses the resource through a small diameter vertical or horizontal well and uses hydraulic and mechanical forces to break up and granulate the resource. The resource is circulated in a water slurry to the surface where it is separated from the water and stockpiled, and the water is then recirculated into the well in a closed-loop system.

This technology has not yet been tested in the field, but is predicated on component parts that are routinely used in industry. The Company has applied for patent coverage of this technology and is currently working to build the tool and deploy it on an acceptable test project.

The Company intends to pursue business opportunities with companies that own proven resource deposits with the objective of earning equity interests in these projects or generating revenue through licensing of the technology.

China Exploration Effort

The Company has met with mining executives across a number of disciplines and generated significant interest for its jet cavitation tool. One of the most significant opportunities is with Chinese CBM projects.

China hosts the world's third largest CBM resource base.(1) China has implemented several incentive programs for CBM to stimulate production, with a publicly announced policy objective of increasing natural gas usage in the country. In addition, while natural gas prices remain depressed in North America, Chinese natural gas prices are strong at $5-$9 per mcf.

A large portion of China's coalbed deposits are known to be high-rank, high-gas content, low permeability coals to which the Company's jet cavitation tool is uniquely suited. In addition, use of the jet cavitation tool would significantly improve mining safety by de-gassing coal seams before mining personnel enter the area, reducing the chance of explosions that have plagued the Chinese coal-mining industry.

China also hosts the largest shale gas resource of any country in the world,(2) although the industry is well behind North American standards and negligible quantities of gas have been produced to date. The Company believes that working with CBM deposits in China would also lead to some additional opportunities in shale gas.

Peace River CBM Project Abandonment, Sale of Gas Plant and Associated Equipment

In the face of stubbornly low natural gas prices, the Company has decided that opportunities to commercialize its jet cavitation tool hold greater future value for the Company than the North American CBM industry. As a result, the Company has decided to monetize most of the residual value in the Peace River CBM Project and apply it to the jet cavitation technology.

The Company has sold the Peace River gas plant and associated equipment, bringing $550,000 to the Company's treasury.

To reduce carrying costs, the Company will proceed to plug and abandon the Peace River CBM Field, with the exception of the water disposal well, which will be held for future value. A $2.15 million deposit is held by the BC Oil & Gas Commission to cover the plugging and abandonment obligations. The Company will abandon the Peace River CBM Field as economically as possible, and expects to realize a partial refund on the deposit.

Financial Position

The Company currently has approximately $33,000 of working capital and $476,000 of cash on hand. Included in the working capital is $443,778 owed to members of management and the Board. Repayment of the majority of the $443,778 will be deferred until the Company realizes additional cash. As such, the Company believes it has the financial capacity to achieve its near-term objectives to advance the jet cavitation tool.

On behalf of the Board of Directors of Canada Energy Partners Inc.

John Proust, Chairman

Neither the TSX Venture Exchange nor its Regulation Services Provider (as such term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward-looking Statements: This press release contains forward-looking statements relating to expected or anticipated future events and results that are forward-looking in nature and, as a result, are subject to certain risks and uncertainties, such as general economic, market and business conditions, the regulatory process and actions, technical issues, new legislation, competitive and general economic factors and conditions, the uncertainties resulting from potential delays or changes in plans, the occurrence of unexpected events, and the Company's capability to execute and implement future plans. Actual results achieved may vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors. There is no representation by the Company that actual results achieved during the forecast period will be the same in whole or in part as that forecast.

(1) The Oxford Institute for Energy Studies, "Will There Be a Shale Gas Revolution in China Before 2020?" by Fan Gao, NG 61, April 2012, Page 6.

(2) United States Energy Information Agency, "World Shale Resource Assessments", September 24, 2015.

Contact Information:

Canada Energy Partners Inc.
John Proust
+1 604.609.5130

Canada Energy Partners Inc.
Ben Jones
President and CEO
+1 225.388.9900 ext 101

Canada Energy Partners Inc.
3123 - 595 Burrard Street
Vancouver, BC V7X 1J1