Cabo Mining Enterprises Corp. (“Cabo or “Company”) today announces that it has
completed the acquisition of 100% of the shares of each of Heath & Sherwood Drilling (1986) Inc. (“Heath & Sherwood Drilling”) and Petro Drilling (Maritimes) Limited (“Petro Drilling”); thereby controlling a fleet of 60 drills and employing in excess of 150 people.
Cabo purchased 100% of the shares of Heath & Sherwood Drilling by issuing 2,120,000 common shares at a deemed price of $0.50 for total consideration of $1,060,000. Cabo purchased the shares of Petro Drilling for $100 in cash. Also, as part of the purchase, Cabo lent $499,900 in cash to Petro Drilling to be loaned to its subsidiary, Petro Drilling Company Limited (“Petro”); to settle existing shareholder loans; issued 1,100,000 common shares at a deemed price of $0.50 per share to Frank Nolan for 100% of the shareholder debt owed to Frank Nolan by Petro Drilling; and issued 57,500 common shares at a deemed price of $0.50 per share to permit Petro Drilling to complete the acquisition of the Petro common shares not owned by Petro Drilling, thereby giving Petro Drilling 100% interest and control of Petro.
Having received TSX Venture Exchange approval of the Heath & Sherwood Drilling and Petro Drilling acquisitions, and the resulting change of business, and in conjunction with the closing of these transactions, the $7,187,599 escrowed funds received pursuant to the closing of the brokered and non-brokered private placements which closed in April 2004, have been released to the Company and the resulting 9,205,300 units, consisting of one common share and one half of one common share purchase warrant have been issued effective today. A finders fee of $50,000 and 135,411 units, consisting of one share and one half of one common share purchase warrant, has been paid to Jason Hommel for the
non-brokered private placement, and a commission of $205,982 plus brokers warrants to purchase 345,530 additional units of one share and one half of one share purchase warrant, at $0.83 per unit, have been paid to Research Capital Corporation. One full warrant is required to purchase one additional common share at $1.25 per share.
About Heath & Sherwood Drilling:
Heath & Sherwood Drilling operates from Kirkland Lake, Ontario, with administration offices in Thornhill, Ontario. Heath & Sherwood Drilling and its predecessors have been active in the drilling industry in Ontario for over 80 years. Their core activity is diamond drilling in the minerals sector, primarily in Ontario, currently focused on mine site drilling both above ground and underground. They have a great deal of experience working in remote and Arctic conditions in the past, as well as on international assignments, including Greenland. Major customers include Inco Ltd., Newmont Mining Corporation of Canada Ltd., Placer Dome Inc., Teck Cominco Ltd., and Falconbridge Ltd. Heath & Sherwood Drilling presently owns a fleet of 37 drill rigs, including 16 aboveground and 21 underground drills and it has approximately 120 full time employees.
About Petro Drilling:
Petro Drilling operates from Springdale, Newfoundland. Their main focus is on early to intermediate stage exploration diamond drilling in the Atlantic Provinces of Canada. In the past 35 years in the drilling industry, Petro Drilling has worked internationally, and also in remote Arctic locations. It is one of two diamond drilling contracting firms in Canada with equipment and personnel experienced in slimhole core drilling for oil and gas exploration. Petro Drilling owns a drilling fleet of 23 rigs and has approximately 25 full time employees. In addition to Canadian drilling contracts, Petro has completed projects in Latin America, Greenland, Ireland, Africa and the Middle East.
Concurrent with the closing of the drilling company acquisitions, Terry Aimone and
Frank Nolan have been appointed to the Cabo Board of Directors effective today. They have also accepted the positions of President of Heath & Sherwood Drilling and Petro Drilling respectively. Seymour Sears has resigned as a director of the Company Mr. Aimone, BSc, P.Eng started his career as a mining consulting engineer followed by 17 years in the U.S. banking sector working in project financing. He has been CEO and managing director of Heath & Sherwood Drilling for the past 11 years and brings a strong mix of technical, financial and management experience to the Company. Mr. Nolan, MSc, P.Eng., began working as a geologist in 1956 and has worked within the mining and oil and gas industries as a consultant and senior executive since that time. He has considerable experience in the geoenvironmental engineering and science sector as well. Mr. Nolan provides the Company with many years of senior management
experience in the mineral exploration, mining and geotechnical industries.
Cabo is a mineral exploration and drilling services company headquartered in Vancouver BC Canada. Cabo is traded on the TSX Venture Exchange under the symbol: CBE. Cabo’s mineral properties are located in Cobalt, Kenora, and Sudbury Ontario, Canada. Further information about these acquisitions and the change of business can be found in the Company’s Filing Statement dated June 10, 2004 posted on the Cabo website and Sedar (www.sedar.com).
ON BEHALF OF THE BOARD
(signed “John Versfelt”)
John A. Versfelt
Chairman, President and CEO
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The Exchange has not in any way passed upon the merits of this news release. This news release may contain forward-looking statements including but not limited to comments regarding the timing and content of upcoming work programs, geological interpretations, potential mineral recovery processes and other business transactions timing. Forward-looking statements address future events and conditions and therefore, involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements.