November 12, 2012, Vancouver, BC - Petrostar Petroleum Corp. (TSX-Venture: PEP; "Petrostar" or "the Company") is very pleased to announce that it has negotiated and signed a Definitive Agreement with NEPCO LLC of Cheyenne, Wyoming regarding the Letter of Intent ("LOI") announced October 25, 2012.
Subject to regulatory approval, this Joint Venture ("JV") will allow Petrostar to engage in a partnership to form a new entity based in Alberta, Canada, focused on the development of modular distillation facilities. The new entity will be owned 60% by NEPCO LLC and 40% by Petrostar. This opportunity will also allow Petrostar to participate in distillation projects outside of Canada, on a per-project basis. The first location in Canada is currently being assessed for suitability.
The distillation plants will consist of a single modular facility capable of distilling up to 2,500 barrels of crude per day to produce various petroleum fuels and marketable by-products. The distillation plants can be retrofitted and expanded to process up to 10,000 barrels per day of production per single site. This technologically-advanced facility will be the first of its kind in Canada.
Under the terms of the agreement:
a.The new entity will be governed by a board of 4 Directors and a Chairman. Two members will be appointed by NEPCO LLC and two appointed by Petrostar.
b.NEPCO LLC will make a 2-plant commitment to the new entity and will receive a 7.5% stake of the outstanding shares of Petrostar per plant.
c.Petrostar has agreed to raise CAD$2 million in exchange for its 40% ownership in the new entity.
d.A 1-time licensing fee of CAD$150,000 will be paid to NEPCO LLC to commence site-specific planning and licensing.
About Petrostar Petroleum Corp.
Petrostar is a Tier 2 Canadian-based oil and gas exploration company trading on the TSX Venture Exchange. The long-term objective of management is to aggressively seek properties with high potential that can be advanced with minimum expenditures. The policy of the Company is to lower shareholders' risk exposure to various stages of exploration by entering into joint ventures with third parties or acquiring projects that the Company can operate as the sole owner-operator.
For further information, please contact Bruce Scafe, IR and Communications Officer, at 1-877-737-8864 or email@example.com.
Neither the TSX Venture Exchange nor the Investment Industry Regulatory Organization of Canada (IIROC) accepts responsibility for the adequacy or accuracy of this release.