PRD Energy Inc. announced that the Company has decided to cease operations in Germany. The company's experience to date and near term outlook has led the Company to conclude that the opportunities available in the German basin at this time are not viable for a company of PRD's size and stage of development. Central to the Company's decision has been the drastic decline in global commodity prices and ongoing negative outlook. The extension of cycle times for permitting has resulted in many of the Company's projects becoming uncertain and uneconomic. Although the Company has successfully accessed legacy data, it has been at significant cost and on lengthy timeframes. In addition, following detailed analysis of the legacy data, a number of the properties for which the Company has obtained licenses have been determined to be uneconomic based on current commodity prices. Despite significant efforts, the Company has been unable to affect material partnership arrangements with incumbents to provide the economies of scale required to properly grow and expand its business in lower risk re-development opportunities. The adaptation of local service providers to North American drilling and operating practices, and the ongoing reluctance of regulatory authorities to approve such practices, make it unlikely that the Company will be able to execute its required cost reduction strategies. Further, recent royalty changes in the state of Schleswig-Holstein, a state where the Company holds a significant
portion of its exploration lands, have made the Company's prospects in that state uneconomic. For these and other reasons, the Company has determined that it is in the best interests of PRD and its shareholders to cease operations in Germany. In this regard, the Company terminated the employment of its German staff effective August 31, 2015 and is taking steps to close its Berlin office. In addition, the company will be reducing its technical staff in the Calgary office together with a reduction in other ongoing administrative expenses.