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Golden Gate Petroleum Ltd, Update: Permian Project

As noted in our media release on 14 August 2013, we have filed a motion with the Texas Court seeking summary judgment on several issues alleged by Petro-Raider in its ongoing litigation with the Company. The court has scheduled the hearing on our motion for 8 November 2013 in Big Lake, Texas, with a ruling expected sometime thereafter.

The Company expects this ruling to settle several unresolved questions of law and better define any unresolved issues. Either party would have the right to appeal an unfavorable ruling, but the Company anticipates that the aforementioned pre-trial ruling will still provide guidance on assessing any potential exposure, and consequently, will better position us to continue the development of our Permian Basin asset. Even in the event of an adverse ruling at the trial, in June 2014, GGP believes that the case can be won on appeal.

The primary claims by Petro-Raider are its rights to a 5% net profits interest and 20% working interest back-in. These interests do not vest until the Company’s capital costs have been recovered, which is expected to take years. Petro-Raider also contends that when the Company recovers 110% of the amount of its capital costs that the back-in increases to 25%. Petro-Raider makes no claim to the balance of the working-interest. Petro-Raider also claims fraud, tortious interference and civil conspiracy.


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