CALGARY, AB / ACCESSWIRE / March 15, 2023 / Avila Energy Corporation (CSE:VIK) ("Avila" or the "Company") provides update on negotiations with Insight Acquisition Corporation to combine with the Company and its Operations in Western Canada.

Avila Energy Corporation on January 26, 2023 announced a preliminary non-binding Letter of Intent (the "LOI") with Insight Acquisition Corp. (NYSE:INAQ.U) ("IAC"), a Delaware corporation and a Special Purpose Acquisition Company, pursuant to which IAC is to combine with the Company (the ‘'Resulting Company'') in a transaction that will result in the combined entity being publicly listed for trading on a major stock exchange in the United States (the "Transaction"). The Transaction remains subject to the approval of the boards of directors and stockholders of each of IAC and the Company, as well as other customary closing conditions, including negotiation and execution of a definitive business combination agreement for the Transaction (the "Definitive Business Combination Agreement"), which may or may not occur. The Transaction will also be subject to regulatory approvals.

The parties to the LOI have agreed to continue to negotiate the terms of a Transaction, including a Definitive Business Combination Agreement, on an exclusive basis with the intention of coming to a definitive Agreement on or before March 24, 2023, at which point IAC may extend such time for an additional 15 calendar days. Avila will issue a subsequent news release outlining the definitive terms for the Transaction once a Definitive Business Combination Agreement has been entered into.

As previously announced, the LOI remains non-binding and subject to constant evolution as the terms and conditions of the Transaction firm up. However, the negotiation and analysis of the Transaction continues to advance, since it was announced on January 26, 2023. IAC held its shareholder meeting on March 7, 2023, and post the declaration of initial redemptions, currently has approximately U.S. $28,000,000 cash in trust. In connection with the Closing, the shareholders of IAC will be entitled to seek a final redemption of outstanding public shares, in exchange for a pro-rata portion of such trust proceeds. Any proceeds that remain in trust following such redemption will be available to the Resulting Company at Closing. As a result of the redemptions, the 80% rule is now assessed on the balance remaining in trust at the signing of the Definitive Business Combination Agreement.

For better clarity, the Definitive Business Combination Agreement include the following provisions:

  1. The Transaction will create the Resulting Company, the shareholders of which will be composed of the then current shareholders of Avila and shareholders and various participating parties of IAC and Insight Acquisition Sponsor LLC (the "Sponsor"). The Sponsor is the current sponsor of IAC.
  2. By way of a Forward Purchase Sale Agreement ("FPSA") presently under negotiation, the Company will have the ability to retain US $25,000,000 in Trust with IAC at Closing. In addition, prior to Closing, U.S. $10,000,000 up to U.S. $35,000,000 is under consideration to be concurrently raised by way of convertible debentures or other financial instruments. Negotiations with several strategic investors are advancing (but not closed).
  3. In one scenario (high), post-closing of the Transaction, assuming no additional capital is raised and the U.S.$25,000,000 FPSA is sold into the market at or above US $9.50 per share, it is anticipated that the current and converted shareholders of Avila will hold collectively 12,528,000 shares of the Resulting Company, being approximately 59.6% of the then issued and outstanding shares of the Resulting Company post-closing of the Transaction. Based on the assumptions above, post-closing, Leonard B. Van Betuw's interest will remain more than 10% of the outstanding of the Resulting Company.
  4. In another scenario (low), post-closing of the Transaction, assuming all U.S.$28,000,000 in Trust is converted in to Shares @ $10 per share and the FPSA is sold into the market at or above US $9.50 per share, it is anticipated that the current and converted shareholders of Avila will hold collectively 12,528,000 shares of the Resulting Company, being approximately 52.1% of the then issued and outstanding shares of the Resulting Company post-closing of the Transaction. Based on the assumptions above, post-closing, Leonard B. Van Betuw's interest will remain more than 10% of the outstanding of the Resulting Company.
  5. While the final structuring of the Transaction has advanced significantly since January 24, 2023, Avila cautions that the Transaction continues to be subject to receipt of corporate, securities and tax advices for both Avila and IAC and closing of the Transaction shall be subject to successful negotiation and signing of the Definitive Business Combination Agreement and satisfaction of customary closing conditions including approval by Canadian and US securities regulators, approval by the IAC shareholders of any additional extensions that may be required from time to time in advance of consummating the contemplated initial business combination, and subsequent listing approval by a recognized United States Securities Exchange and approval by the boards of directors and shareholders of IAC and Avila, as may be applicable.
  6. The Board of Directors of the Resulting Company is expected to consist of seven persons, five of which shall be appointed and designated by Avila, including three independent directors, and Leonard B. Van Betuw will remain the CEO and Chairman of the Board of the Resulting Company.
  7. Avila has agreed to fully cooperate with IAC in the preparation of all documents required to be filed with the United States Securities and Exchange Commission (including all exhibits and amendments thereto), or any other regulatory body, in connection with the Transaction.
  8. The earn-out provision, as part of the Transaction, as well as ancillary employment agreements are expected to be entered into between current members of Avila's management and the Resulting Company. Shares of the Resulting Company will be granted to certain persons (all to be named once the contemplated transaction is finalized and are to include namely, Employees, Executives, Directors, and Advisors) based on stock price performance on an earn-out structure basis. The presumed value is $100,000,000 but is subject to change. Leonard B. Van Betuw, current CEO and director of Avila, will receive a portion of the earn-out shares but the number of shares to be awarded to Mr. Van Betuw is yet to be determined. The Company understands that shareholder approval may be required for the final approval of the earn-out payout.


Northeast British Columbia

On June 29, 2022, the Company participated in a Joint Venture with its partner, 611890 Alberta Inc. (‘'611'') and acquired a 7% of interest in oil and gas properties in the Northeast British Columbia area ("NEBC"). As of September 30, 2022, the Company, through its initial Joint Venture with 611 acquired an additional 17% interest, for a cumulative total of 24%. On December 1, 2022, the Company acquired the remaining 76% interest for a cumulative total of 100%. The total amount paid to 611 for the acquisition of 100% in the Joint Venture for NEBC was $2,400,000. The acquired oil and gas interests in NEBC was valued at $7,600,044 together with the assumption of $21,497,890 in decommissioning liabilities based from the BCOGC (defined below). These decommissioning liabilities included amounts for 4 facilities and 111 wells that are either shut in or producing. The Joint Venture in NEBC is construed as being a related party transaction under IFRS IAS 24 due to Leonard B. Van Betuw being a member of the key management personnel of the Company and the Joint Venture partner, 611.

Operations in Western Canada for the Company have been challenged by the on-going attempts to negotiate reasonable terms to complete the post-closing conditions for the transfer of the wells and facilities in NEBC with the BCOGC.

In June 2022, the security deposit in place with the Province of British Columbia was $1,800,000, which the Company recognized was an assumed liability that was acceptable and warranted, within the context of gas prices being realized by the property of approximately $6.00/GJ and by way of the contract being to the benefit of the seller as agreed within the scope of the Purchase and Sale Agreement.

Upon the seller completing its independent submissions to the British Columbia Oil and Gas Commission (the "BCOGC") in September of 2022 (under the recently updated regulator process implemented in the first half of 2022), the Company submitted its application to receive the property as required by the recently updated legislation for the acceptance of licenses being sold to the Company.

In November of 2022 the initial assessment completed by the BCOGC was completed and a deposit of $11,800,000 was requested by BCOGC to be posted by the Company. At this time the Company requested the BCOGC to complete a review of the assessment based on the 600% increase of $1,800,000 that was currently held as security for the assets, representing a material difference. The seller and the buyer both recognized that the assessment was materially more than what was contemplated and agreed to extend the post-closing conditions for the transfer, at which time Avila agreed to advance an additional non-refundable deposit of $3,000,000 as part of an understanding that with more time the Seller will submit all of the decommissioning activities completed in 2022 by the seller on behalf of Avila as the buyer to the BCOGC as part of a request to the BCOGC recompletion the assessment including the work in progress that underway in the months of January and February of 2023.

In addition to the ongoing challenges with the BCOGC, other concerning issues recently continued to weigh in on the Company's assessment of the investments to date and the post-closing capital investment being proposed by the Company. The Company has based their decision on the factors as the following:

  1. The current assessment by the BCOGC suggested that the Company should be concerned that it is a strong possibility that the recent unwillingness by the ministry to support the on-going development in the region is not just a policy, but a potential entrenchment to only accept the best of the "best-in-class" to continue to actively operate under an increasingly strict set of guidelines that includes continual changes in policy that include not less, but more, punitive and unexpected financial burdens.
  2. Recent winter activities and suggested decommissioning activities on behalf of Avila by the seller, give reason to believe that there are a number of unassessed concerns that the BCOGC continues to be focused upon that have not been fully communicated by the seller to Avila. In addition, Avila now believes that the current decommissioning long-term assessment of approximately $22.8 million by the BCOGC maybe understated.
  3. At the time of closing the transaction in June of 2022 natural gas prices were approximately $6.00/GJ and as of Friday, March 10, 2023, natural gas opened at $3.00/GJ.

"Any one or even two of these negative factors are reasonable and rational risks to be expected within the oil and natural gas sector, but upon taking into consideration the many negative factors currently at play, the Company has made a difficult, yet rational decision, on behalf the Company and its shareholders." said Leonard B. Van Betuw, President and CEO.

Accordingly, the Company has made a final assessment that the overall commitment to the region it was about to conclude was not economically justified; especially taking into account the acquisition and closing costs of $2.4 million, the financial posting of cash into a restricted account as security to the BCOGC totaling $11.8 million, an additional immediate financial capital commitments of $20.5 million and the assumption of a decommissioning obligations of $22.8 million that comes with a looming cloud of currently unknown but growing concerns. With all of these tangibles and intangibles taken into account, the total cash commitment of $57.5 million, Avila's management chose not to proceed with the transaction. Avila is exploring its options to recover a portion of the payments made to the seller and indirectly the BCOGC to date.

Ryan Schnitzler, Land Manager for Avila, agreed, "Despite best efforts, Avila was unable to reach mutually beneficial terms on the asset transfer deposit with the BCOGC. That paired with the declining Natural Gas prices, deemed the acquisition uneconomic to go forward. Accordingly, I agree the decision to write-off the opportunity, as difficult as it is, is the correct decision for Avila."

The Company's final decision was based on the fact that making a total commitment of no less than $34.7 million in the next 6 months with a looming obligation of more $22.8 million that did not compete with the Company's other business units, was not financially sound. At current market prices for natural gas, the $34.7 million investment would have taken 3 years to recover assuming natural gas prices stabilize at an average price of $3.00 per GJ or better to the end of 2025, or at a cost of $7,250 per flowing boe/d, assuming an average production rate of 4,790 boe/d for the next 36 months in Northeast British Columbia. In short, this investment became high risk and not financially sound and has been abandoned.

To date, the Company has incurred costs of $5,400,000 for the NEBC acquisitions which the Company will be writing off completely.


In Alberta average production is currently fluctuating between 500 boe/d and 700 boe/d. With an approximate capital investment of $800,000, the company expects the rates to increase to 1,000 boe/d with the completion of the balance of the Company's facilities upgrades, workovers and well completions in Alberta.

Recent results for one of the Company's best accomplishments, came on-line in March 1, 2023, after the facility had been tested and certified, the associated tied in cased and standing well continues to clean up with encouraging results. At the time of testing prior to completion the well tested at approximately 1,200 mcf, 10% liquids for a total of 200 boe/d. Currently the well and continues is trending towards a stabilized rate of 150 boe/d based with the production rate anticipated to be limited due to it only being perforated. After assessing the natural flow rate, the Company as evaluated by its QRE in the NI 51-101 issued on August 18, effective July 1, 2022 had estimated the potential for the well to produce at rates of 250 boe/d is possible upon completion of a stimulation program by way of up to a proposed frac.

The current cost to date for this well is underbudget; with current costs being $280,000 including the associated facilities and pipeline tie-ins. The total cost of $1,870 per boe/d assuming the well stabilizes at 150 boe/d or in comparison, 25% of the $7,250 boe/d in costs that were budgeted to be spent in Northeast British Columbia, this is approximately a 400% greater return on investment.

"These results and additional activities currently underway including the preparation for the licensing of the first tranche of up to 4 natural gas wells and 8 oil wells to be drilled in the next twelve months; confirms the Company's focus on realizing the best return on investment as Avila presses on towards reaching our initial milestones of 2,000 boe/d in 2023 followed by "The recent results of our efforts in West Central Alberta confirm that our correction to focus the Company's human and capital resources in Alberta is necessary." said Leonard B. Van Betuw.

Vertically Integrated Energy Business

The Company continues to advance its Vertically Integrated Energy Business. It is the Company's belief that this is the correct path forward for the Company. At this time the Company has chosen to limit its advancements with the business and will not be providing guidance until a material threshold has been public achieved, to limit any the loss of its competitive advantage as a first mover within a very important emerging sector of the economy.

The Company decided to withdraw the forward-looking comments and assumptions pertaining to the future sales of the EnerTwin from the November 14, 2022 press release because the customer sales projection was based on internal market research which may seem speculative and misleading. The comments regarding the sales projections of customer numbers did not have any assumptions or risks as per Part 4A of NI51-102 Continuous Disclosure Obligations. At this time, the Company elects not to provide the details of the assumptions as releasing this information has the possible implications of the Company losing its competitive advantage of being a first mover of this technology in North America. In due time, the Company will provide the appropriate level of details and properly substantiate the numbers with assumptions and risks regarding potential sales related to the EnerTwin technology.

About, Avila Energy Corporation

The Company is an emerging CSE listed corporation trading under the symbol (‘VIK'), and in combination with an expanding portfolio of 100% Owned and Operated oil and natural gas production, pipelines and facilities is a licensed producer, explorer, and developer of energy in Canada. The Company, through the implementation of a closed system of carbon capture and sequestration and an established path underway towards the material reduction of Tier 1, Tier 2, and Tier 3 emissions, continues to work towards becoming a Vertically Integrated low-cost Carbon Neutral Energy Producer. The Company continues to grow and achieve its results by focusing on the application of a combination of proven geological, geophysical, engineering, and production techniques.

About, Insight Acquisition Corp.

Insight Acquisition Corp. is a special purpose acquisition company formed solely to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses. Insight Acquisition Corp. is sponsored by Insight Acquisition Sponsor LLC.

For further information, please contact:

Ronnie Shporer, Investor Relations, North America or
Peter Nesveda, Investor Relations, International or
Leonard B. Van Betuw, President & CEO of Avila Energy Corporation.


Ronnie Shporer:
Peter Nesveda:
Leonard B. Van Betuw:


Leonard B. Van Betuw
President & CEO
Contact phone number: (403) 451-2786

Cautionary and Forward-Looking Statements

Certain information set forth in this news release contains "forward-looking statements" with respect to the proposed business combination between the Company and IAC. Forward-looking statements may generally be identified by the use of words such as "believe," "may," "will," "estimate," "continue," "anticipate," "intend," "expect," "should," "would," "plan," "project," "forecast," "predict," "potential," "seem," "seek," "future," "outlook," "target" or other similar expressions (or the negative versions of such words or expressions) that predict or indicate future events or trends or that are not statements of historical matters. Forward-looking statements are predictions, projections, and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties that could cause the actual results to differ materially from the expected results. These statements are based on various assumptions, whether or not identified in this communication. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as and must not be relied on by an investor as, a guarantee, an assurance, a prediction, or a definitive statement of fact or probability. Many actual events and circumstances are beyond the control of the Company and IAC.

All statements in this news release, other than statements of ‎historical facts, that address events or developments that the Company expects to occur, are forward-looking statements, ‎including, but not limited to entrance into a Business Combination Agreement, the occurrence of and the anticipated date of closing of the Transaction, the availability of financing for the Transaction and IAC at the time of signing, the anticipated price per share post-closing of the Transaction, and the post-Closing governance of the Resulting Company. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of ‎which are beyond the Company's and IAC's control, including completion of customary due diligence with respect to the Transaction, negotiation of the definitive documentation including the Business Combination Agreement, approval of the Transaction by Company and IAC shareholders, approval by the IAC shareholders of an extension of the time by which they must consummate an initial business combination, listing approval by a United States exchange and the impact of general economic conditions, ‎industry conditions, the regulatory environment, volatility of commodity prices, currency fluctuations, environmental risks, operational risks, ‎competition from other industry participants and stock market volatility. Although the Company and IAC believe that the ‎expectations in its forward-looking statements are reasonable, its forward-looking statements have been based ‎on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and ‎assumptions are based upon currently available information. Such statements are subject to known and ‎unknown risks, uncertainties and other factors that could influence actual results or events and cause actual ‎results or events to differ materially from those stated, anticipated or implied in the forward-looking statements. ‎Accordingly, readers are cautioned not to place undue reliance on the forward-looking statements, as no ‎assurance can be provided as to future results, levels of activity or achievements. Risks, uncertainties, ‎material assumptions and other factors that could affect actual results are discussed in the Company's public disclosure documents available at and IAC's public disclosure documents available through the EDGAR filing system at Furthermore, the forward-looking ‎statements contained in this document are made as of the date of this document and, except as required by ‎applicable law, neither the Company nor IAC undertake any obligation to publicly update or to revise any of the ‎included forward-looking statements, whether as a result of new information, future events or otherwise. The ‎forward-looking statements contained in this document are expressly qualified by this cautionary statement.‎


bbls/d - barrels per day
BOE/d - barrels oil equivalent per day
NGLs - Natural Gas Liquids
Mboe - Thousands of barrels of oil equivalent
MMboe - Millions of barrels of oil equivalent
PDP - Proved Developed Producing
TP - Total Proved Reserves
TPP - Total Proved and Probable Reserves
IFRS - International Financial Reporting Standards as issued by the International Accounting Standards Board
WTI - West Texas Intermediate, the reference price paid in U.S. dollars at Cushing, Oklahoma for the crude oil standard grade

Certain information in this news release, including the operations at the Company's properties, constitute forward-looking statements under applicable securities laws. Although Avila Energy Corporation believes that the expectations reflected in these forward-looking statements are reasonable, undue reliance should not be placed on them because Avila Energy Corporation can give no assurance that they will prove to be correct. Since forward looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. The forward-looking statements contained in this news release are made as at the date of this news release and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws. This release includes certain statements that may be deemed "forward-looking statements." All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that the Company expects are forward looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward looking statements include market prices, exploitation, and exploration successes, continued availability of capital and financing, and general economic, market or business conditions. It should not be assumed that the estimates of net present value of future net revenue attributable to the Company's reserves presented above represent the fair market value of the reserves. The recovery and reserve estimates of the Company's oil, NGL, and natural gas reserves provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered. Further, there is no assurance that the forecast prices and costs assumptions will be attained, and variances could be material. Investors are cautioned that any such statements are not guarantees of future performance and those actual results or developments may differ materially from those projected in the forward-looking statements. Barrel ("bbl") of oil equivalent ("boe") amounts may be misleading particularly if used in isolation. All boe conversions in this report are calculated using a conversion of six thousand cubic feet of natural gas to one equivalent barrel of oil (6 mcf=1 bbl) and is based on an energy conversion method primarily applicable at the burner tip and does not represent a value equivalency at the well head. This news release shall not constitute an offer to sell or the solicitation of any offer to buy, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or applicable exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws. Trading in the securities of Avila Energy Corporation should be considered highly speculative. Neither the Canadian Stock Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Canadian Stock Exchange) accepts responsibility for the adequacy or accuracy of this release. For more information on the Company, Investors should review the Company's registered filings which are available at

SOURCE: Avila Energy Corporation

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