GLOBE NEWSWIRE

Asian Mineral Resources Limited (the “Company”) (ASN-TSX Venture) is pleased to announce that it has entered into an agreement to acquire (the “Acquisition”) all the issued and outstanding shares of Nigerian-based Decklar Petroleum Limited (“Decklar”). Decklar’s sole asset is a Risk Service Agreement (“RSA”) with Millenium Oil and Gas Company Limited (“Millenium”).  Millenium is the owner of the Oza Field located onshore in the northern part of Oil Mining License 11 in the Eastern Niger Delta of Nigeria.  The RSA entitles Decklar to cost recovery and a share of distributable funds from the Oza Field in exchange for technical and financial support.  Closing of the proposed acquisition is subject to certain customary conditions, including the exercise of at least 10,000,000 of the 13,333,333 outstanding common share purchase warrants of the Company (“Warrants”) and approval by the TSX Venture Exchange (the “TSXV”). Closing of the Acquisition is expected to occur in December 2019.

The Acquisition

The aggregate purchase price (the “Purchase Price”) is CDN$8,550,000, payable through the issuance of 30,000,000 common shares of the Company (“Shares”) based on a deemed value of CDN$0.285 per share.  Of the aggregate Purchase Price, 22,000,000 Shares are payable upon closing of the Acquisition with the balance of 8,000,000 Shares being payable only if the Oza Field achieves a minimum production rate within 12 months of closing as more fully described below.

The 22,000,000 Shares payable upon closing of the transaction will be allocated as to: (i) 14,000,000 Shares to the shareholders of Decklar; and (ii) 8,000,000 Shares to extinguish outstanding debt owed by Decklar to certain arm’s length third parties. The Purchase Price is equivalent to approximately 68.5% of the Company’s issued share capital including the assumed exercise of 10,000,000 Warrants (based on 32,079,770 Shares issued and outstanding). Post-closing, the Purchase Price is equivalent to approximately 40.7% of the Company’s issued share capital including the assumed exercise of 10,000,000 Warrants (based on 54,079,770 Shares issued and outstanding).  None of the Decklar shareholders nor third party debt providers are related to the Company and the Acquisition is not a Non-Arm’s Length transaction within the meaning of the policies of the TSXV.  Additionally, none of the existing shareholders of Decklar are joint actors with one another or with any of the third party debt providers and no new “control person” will be created as a result of the Acquisition.

In the event the Oza Field achieves production net to Millenium of 1,000 bbls/d for a period of ten (10) consecutive days in any thirty (30) day period within twelve (12) months of the date of closing, a bonus payment (the “Bonus Payment”) of a further 8,000,000 Shares is payable to the shareholders of Decklar.

The Oza Field

The Oza Field was formerly operated by Shell Petroleum Development Company of Nigeria Ltd. (“Shell”).  The field has three wells and one side track drilled by Shell between 1959 and 1974.  During the period when Shell was the operator, there were two periods of extended production testing from the Oza-1, -2 & -4 wells. The field was never tied into an export facility nor was it fully developed by Shell and put into commercial production.

In 2003, the Oza Field was awarded to Millenium having won the bid during the Marginal Fields Licensing Round.  Since Millenium’s acquisition of the Oza Field in 2003, approximately US$45 million has been spent in production facilities infrastructure in support of a restart of production including an export pipeline to tie the field into the Shell Trans Niger Pipeline (TNP) pipeline to the Bonny Export Terminal, a lease automatic custody transfer (LACT) unit fiscal metering system, infield flowlines, manifolds and a rental Early Production Facility. The RSA with Millenium provides Decklar a share of production and associated cash flow from the Oza Field in exchange for funding and technical assistance to restart commercial production and full field development; including a preferential return of its costs plus a share of cash flow thereafter. More specifically, Decklar intends to undertake a low cost re-entry and testing of one of the existing wells to assess the development potential of the Oza Field.  In exchange, Decklar is entitled to priority recovery of its capital from 80% of distributable funds.  After achieving cost recovery, Decklar’s profit share is based on a sliding scale starting at 80% and declining to 40% once cumulative production exceeds 10 million bbls.

Mr. Chris Castle, the Chairman of Asian Mineral commented, “The Company is very excited by the potential of the Oza Field in Nigeria.  The proposed acquisition is consistent with the Company’s ongoing strategy to expand its portfolio of resource opportunities beyond the mining industry to include the energy industry.”