Petrox Resources Corp. (TSXV: PTC) has entered into a definitive Master Gas Supply and Power Generation Agreement with International Energy (Hong Kong) Group Company Limited, replacing a non-binding term sheet announced on August 31, 2026. Under the agreement, Petrox will supply natural gas from Alberta and Saskatchewan sites to modular gas-fired power generation equipment owned and operated by IEHK, with electricity consumed on site for computing load. The deal introduces a fee-per-kilowatt-hour revenue structure for Petrox and grants IEHK an equity subscription right of up to 19.99% of the company's issued shares. Investors may be watching the arrangement as a potential new monetisation path for stranded or underutilised gas assets.

Key Points

  • Petrox Resources Corp. (TSXV: PTC), a Calgary-based oil and natural gas company
  • Definitive Master Gas Supply and Power Generation Agreement signed with IEHK, replacing the August 31, 2026 non-binding term sheet
  • IEHK plans, but is not obligated, to deploy 50 MW to 100 MW of generation capacity by 2028; first 1 MW unit delivery planned for January 2027
  • Investors should watch for TSX Venture Exchange acceptance of IEHK's equity subscription right and execution of individual site schedules

Fee Structure and Natural Gas Pricing Under the Petrox–IEHK Agreement

The Definitive Agreement establishes that IEHK will pay Petrox a fee of US$0.01 per kilowatt hour of qualified power generation, measured at the output terminals of the generating equipment, in addition to paying for the natural gas consumed. Gas pricing is determined on a site-by-site basis. Pipeline-connected sites are priced at the AECO/NIT monthly index. For stranded, shut-in, or underutilised gas, pricing is negotiated between the parties and may fall below the index. Where gas is held by a third-party partner, the price may range from nil to the index price.

Roles and Responsibilities Divided Between Petrox and IEHK at Each Site

The agreement clearly separates operational responsibilities. IEHK owns, installs, operates, and maintains all power generation and computing equipment, and is responsible for equipment approvals, electrical and gas permits, emissions registration, and noise obligations. Petrox retains well, facility, and pipeline licences, environmental authorisations for upstream facilities, surface rights, and landowner agreements, and carries out Indigenous consultation obligations required of the licensee. IEHK is also required to provide security in favour of Petrox for equipment removal and site restoration at the end of each site schedule. Neither party is obligated to nominate or accept any specific site.

IEHK Equity Subscription Right Requires TSX Venture Exchange Approval

The Definitive Agreement grants IEHK the right to subscribe for Petrox common shares representing up to 19.99% of issued and outstanding shares on a post-issuance basis, exercisable on ten business days' notice. The subscription price would equal the market price of Petrox shares in accordance with TSX Venture Exchange policies at the time of exercise. The release states that no shares have been issued to IEHK as of the announcement date, IEHK holds no existing Petrox shares, and the agreement was negotiated at arm's length with no insider involvement. All share issuances remain subject to exchange acceptance and applicable securities laws.

Deployment Timeline and Commercialisation Outlook

The agreement records IEHK's plan to deploy between 50 MW and 100 MW of generation capacity by 2028, with the first 1 MW unit planned for delivery in January 2027. The release explicitly cautions that IEHK is not obligated to deploy any capacity and that no assurance can be given that any deployment will occur. Sites are added individually through executed site schedules, and Petrox is not obligated to nominate any site or reserve any gas volume. The company's CEO noted that the arrangement allows Petrox to earn fee revenue at the wellsite from gas that otherwise has limited or no economic route to market.