MAH Marksmen Energy Inc

Marksmen Energy Inc. (TSX-V:MAH) (OTCQB:MKSEF) (“Marksmen” or the “Company”) is a 60% working interest partner in a Clinton Sandstone Horizonal (“CSH”) well drilled in Hocking County, Ohio.  The operator of the well is Hocking Hills Energy and Well Services LLC of Ohio.  The Leaman #1 well has been drilled and completed with a 12-stage fracking program.  The final stage of remedial work, required due to technical difficulties encountered after the fracking program, has been delayed by additional requirements of the Ohio Department of Natural Resources (“ODNR”).  ODNR required the operator to upgrade the one-mile bush road and lease to similar standards that are applied to operators in the deep shale regions of eastern Ohio.  These regulations are deemed necessary by ODNR to mitigate any possible environmental impact to the surrounding terrain from erosion due to rain run-off and other factors.  This has resulted in extensive civil engineering work and extra cost to prepare a multi-stage plan (“Plan”) for work on the lease and road through hilly and heavily forested terrain.  An engineering firm, Diversified Engineering, experienced with these standards, was contracted and prepared the Plan and interface with ODNR.  ODNR has approved the Plan.

The operator has indicated that remedial operations are expected to commence on or about November 5, 2018.  Marksmen anticipates that the well will be equipped and on production by no later than year end. 

By way of its agreement with the operator, the Company has interests in 5,500 acres of additional land with several potential Clinton Sandstone horizontal well locations.  The Company plans an aggressive drilling program in 2019 to fully develop the acreage subject to financing.  Marksmen believes that the Clinton Sandstone has significant potential as a development play that will materially increase its oil production.

To support Marksmen's position on the potential of the Clinton Sandstone, a large exploration company, Enervest, Ltd. (“Enervest”), which has now drilled eight (8) CSH wells approximately 100 miles north of Marksmen's Leaman #1 well, is evaluating plans to drill multiple horizontal wells on its approximately 115,000 gross acres of leases in the East Canton oil field in Ohio. Enervest operates more than 1,600 vertical Clinton Sandstone oil wells (some wells drilled as early as 1947) in the field, drilled on average of 40 acre spacing, where oil recovery from these vertical wells is estimated by Enervest to be approximately 7% of the original oil in place. Enervest reports nearly a 10-fold increase in production from its horizontal wells over vertical wells in the same formation. Additionally, Enervest reports that most of their horizontal wells encountered near virgin reservoir pressures within the field.  Additionally, another large exploration player, US Energy OH LLC is also drilling CSH wells in this field and in other areas in Ohio, and currently has drilled and completed 9 of 21 permitted locations.

Marksmen would like to thank all of our shareholders for their patience and understanding of the challenges that have been faced and endured in completing the Leaman #1 CSH well.

Proposed Private Placement

Marksmen announces that it plans to complete a non-brokered private placement of up to 2,916,667 units (the “Units”) of Marksmen at a price of $0.12 per Unit for aggregate gross proceeds of up to a maximum of $350,000 (the “Offering”). There is no minimum Offering. The Units will be comprised of one (1) common share (“Common Share”) and one-half of one (1/2) share purchase warrant (“Warrant”) of Marksmen. Each whole Warrant entitles the holder thereof to purchase one Common Share for $0.24 expiring two (2) years from the date of the closing of the Offering.

Marksmen may pay a cash commission or finder's fee to qualified non-related parties of up to 8% of the gross proceeds of the Offering (up to $28,000) and broker warrants (the “Broker Warrants”) equal to up to 8% of the number of Units sold in the Offering (up to 233,333 Broker Warrants).  Each Broker Warrant will entitle the holder to acquire one Common Share at a price of $0.12 per Broker Warrant for a period of one (1) year from the date of issuance.

Marksmen intends to use the net proceeds of the Offering to pay for capital expenditures related to remedial and completion work on the Leaman #1 well of approximately $150,000 and the remainder for extra road and lease upgrades as directed by ODNR. 

The Offering is being offered to all of the existing shareholders of Marksmen who are permitted to subscribe pursuant to the Existing Shareholder Exemption. This offer is open until November 30, 2018 or such other date or dates as the Company determines and one or more closings are expected to occur, with the first closing anticipated for October 30, 2018.  Any existing shareholders interested in participating in the Offering should contact the Company pursuant to the contact information set forth below.

The Company has set October 19, 2018 as the record date for determining existing shareholders entitled to subscribe for Units pursuant to the Existing Shareholder Exemption. Subscribers purchasing Units under the Existing Shareholder Exemption will need to represent in writing that they meet certain requirements of the Existing Shareholder Exemption, including that they were, on or before the record date, a shareholder of the Company and still are a shareholder as at the closing date. The aggregate acquisition cost to a subscriber under the Existing Shareholder Exemption cannot exceed $15,000 unless that subscriber has obtained advice from a registered investment dealer regarding the suitability of the investment.

As the Company is also relying on the Exemption for Sales to Purchasers Advised by Investment Dealers, it confirms that there is no material fact or material change related to the Company which has not been generally disclosed. In addition to offering the Units pursuant to the Existing Shareholder Exemption and to the Exemption for Sales to Purchasers Advised by Investment Dealers, the Units are also being offered pursuant to other available prospectus exemptions, including sales to accredited investors. Unless the Company determines to increase the gross proceeds of the Offering, if subscriptions received for the Offering based on all available exemptions exceed the maximum Offering amount of $350,000, Units will be allocated pro rata among all subscribers qualifying under all available exemptions.

Completion of the Offering is subject to regulatory approval including, but not limited to, the approval of the TSX Venture Exchange. The Common Shares and Warrants issued will be subject to a four month hold period from the date of the closing of the Offering.

It is expected that insiders of the Company will participate in the Offering.

For additional information regarding this news release please contact Archie Nesbitt, Director and CEO of the Company at (403) 265-7270 or e-mail ajnesbitt@marksmenenergy.com.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

This news release may contain certain forward-looking information and statements, including without limitation, approvals of the ODNR, the timing and success of the remedial operations, the closing of the private placement, statements pertaining to the use of proceeds, and the Company's ability to obtain necessary approvals from the TSX Venture Exchange. All statements included herein, other than statements of historical fact, are forward-looking information and such information involves various risks and uncertainties.  There can be no assurance that such information will prove to be accurate, and actual results and future events could differ materially from those anticipated in such information.  A description of assumptions used to develop such forward-looking information and a description of risk factors that may cause actual results to differ materially from forward-looking information can be found in Marksmen’s disclosure documents on the SEDAR website at www.sedar.com.  Marksmen does not undertake to update any forward-looking information except in accordance with applicable securities laws.