Pine Cliff Energy Ltd. (TSX: PNE) (OTCQX: PIFYF) ("Pine Cliff" or the "Company") is pleased to announce that it has entered into definitive agreements with a private company ("PrivateCo") for the supply of between 3.2 MMcf/d1 and 4.8 MMcf/d1 of natural gas for an initial term of 25 years pursuant to a natural gas supply agreement ("Supply Agreement"). PrivateCo has agreed to construct and operate a data centre (the "Data Centre") not connected to the Alberta electrical grid, adjacent to an operating Pine Cliff facility in Central Alberta. Under the Supply Agreement, Pine Cliff will provide natural gas and will receive a natural gas price based on a rolling 12-month average of NYMEX price. The supply of natural gas under the Supply Agreement will commence upon, among other things, the commissioning of the Data Centre. In Q3 2024 Pine Cliff's production of natural gas averaged 108.0 MMcf/d.
The construction and operation of the Data Centre will be the sole responsibility of PrivateCo and will be subject to applicable regulatory and government approvals and permits. The Supply Agreement includes conditions precedent for the supply and delivery of natural gas at the Data Centre which include obligatory milestones for the timing of construction, and receipt of regulatory approvals and timing of the Data Centre being commercially operational. Failure to meet these milestones could result in the early termination of the Supply Agreement and the lease.