Contact Exploration Announces Long-term Customer Signed by Pieridae Energy for Goldboro LNG Project

CALGARY, ALBERTA–(Marketwired – June 3, 2013) – Contact Exploration Inc. (“Contact” or the “Company“) (TSX VENTURE:CEX) is pleased to announce that Pieridae Energy (Canada) Ltd. (“Pieridae“) has entered into a long-term sales agreement with E.ON Global Commodities SE (“E.ON“), a subsidiary of E.ON SE, and one of the world’s largest investor-owned power and gas companies, for the purchase of liquefied natural gas (“LNG“) from the Goldboro LNG project being developed by Pieridae in Nova Scotia, Canada. Under the agreement, Pieridae is to deliver approximately 5 million tons per annum (“MTPA“) of LNG to E.ON for 20 years into a number of locations in Western Europe.

As described in Contact’s press release of March 4, 2013, Contact and Pieridae are the partners in Pieridae Production Limited Partnership, a natural gas-focused exploration and production entity formed to source, develop and produce natural gas to serve as significant portion of the feedstock for the Goldboro LNG project.

The sales agreement was signed by Alfred Sorensen, President and CEO of Pieridae and Gareth Griffiths, Chief Commercial Officer, Merchant Trading of E.ON, at a signing ceremony at the Canadian Embassy in Berlin.

Alfred Sorensen, President and CEO of Pieridae remarked that the sales agreement represents one of the major milestones for Goldboro LNG, noting that the agreement with E.ON provides the economic security needed to complete the development of the first process train of the Goldboro LNG terminal. Pieridae noted that the LNG pricing in the sales agreement is based on market prices of natural gas in the Western European market.

In collaboration with Contact, Pieridae is having advanced discussions with North American natural gas exploration and production and pipeline companies, for the purpose of providing natural gas feedstock and transportation services for the Goldboro facility.

Upon completion, the Goldboro LNG terminal will have the ability to export up to 10 MTPA of natural gas, year round, with on-site storage capacity of 690,000 cubic metres of LNG. Upon commencement of commercial operations, expected by the first quarter of 2020, natural gas will be transported to Goldboro, Nova Scotia, primarily using existing pipeline systems and exported by ship to international markets.

“This milestone represents an enormous opportunity for Contact, in our role as the operator of the upstream partnership responsible for securing onshore natural gas reserves and production that will supply the Goldboro facility,” remarked Steve Harding, President and CEO of Contact.

Pieridae is currently conducting the environmental assessment (“EA“) for the Goldboro LNG project. Pieridae expects to submit the EA report to the Province of Nova Scotia in 2013, with approval of the EA being the next major milestone towards the final investment decision for the project, expected in 2015.

http://www.contactexp.com/Press_Release.html