Business
Madalena Comments on Relaxation of Currency Controls in Argentina
Madalena Comments on Relaxation of Currency Controls in Argentina Madalena Comment...
About this update from Centaurus Energy Inc.
[{"type":"text","content":"\n\n\n\nMadalena Comments on Relaxation of Currency Controls in Argentina\n\n/* Style Definitions */\nspan.prnews_span\n{\nfont-size:8pt;\nfont-family:\"Arial\";\ncolor:black;\n}\na.prnews_a\n{\ncolor:blue;\n}\nli.prnews_li\n{\nfont-size:8pt;\nfont-family:\"Arial\";\ncolor:black;\n}\np.prnews_p\n{\nfont-size:0.62em;\nfont-family:\"Arial\";\ncolor:black;\nmargin:0in;\n}\n\n\n\n\n\n\nMadalena Comments on Relaxation of Currency Controls in Argentina\nCanada NewsWire\nCALGARY, Dec. 17, 2015\n\n\n\nCALGARY, Dec. 17, 2015 /CNW/ - Madalena Energy Inc. (TSX-V: MVN and OTCQX: MDLNF) (the \"Company\" or \"Madalena\") does not anticipate the Argentina government's recently announced relaxation of currency controls and a move to only one exchange rate to have a negative impact on Madalena's operations and overall business plan in Argentina. \n\nOn November 23, 2015, the Argentine Republic elected a new center-right government. Based on the campaign platform it was largely expected that currency controls would be relaxed and that the Argentine Peso (\"AR$\") would undergo a devaluation to reflect its purchasing power in the global economy.  \n\nThe following summarizes the impact of the AR$ and the United States dollar (\"US$\") on the Company's activities and addresses how Madalena has been planning for a potential devaluation. All numbers are presented in Canadian dollars (\"CAD\") unless otherwise stated.\n\n\n100% of the Company's crude oil and natural gas revenues are priced and invoiced in US$ and settled in the AR$ at the time of receipt; \nthe Company estimates 100% of its finance and current income tax expenses, 90% of its general and administrative costs, 65% of its operating costs and 20% of its capital expenditures are invoiced and settled in the AR$, therefore the AR$ devaluation reduces those costs and capital expenditures when converted to US$ or CAD; \nthe Company has liquidated approximately 50% of the bonds received from the Argentine government as settlement of the Petroleo Plus program. The current market value of the remaining bonds is approximately US$ 7 million, which are protected from devaluation risk as they are denominated in the US$ and settled in the AR$ upon sale; \nthe Company maintains its cash holding in AR$ at a minimum and its bond holdings at a maximum; \nthe Company has repatriated US$ 3.2 milli...