Black Hawk has purchased of oil and gas leases covering approximately 2,553 acres of land in Cowley County, Kansas. BHWX owns 100% of the leases within the Prospect Area and has an undivided 81.5% working interest in and to the oil and gas leases and their previous 10 shut-in oil and gas wells.
The lease acquisition includes a 100% interest in one shut-in oil/gas well, the #1 Baker, located on the Keith Baker lease. Also acquired is a 100% interest in 9 other oil wells previously shut-in. Black Hawk's Oil 2011 Program calls for re-working all 10 locations directly or in joint venture with Tiger Oil and Energy and returning all of them to cash flow production. "We hope to start re-work on the #1 Baker, Oil and Gas Well in December, 2010 and have it in production January 2011. We also hope to have some exciting news on our future lithium plans and definitive assay results from the November Dun Glen gold and silver drilling, with-in the next 2 to 3 weeks," stated Kevin M Murphy, CEO of Black Hawk Exploration.
On October 27th, 2010 Black Hawk entered into a co-development agreement with TGRO in which, after an investment of $400,000 by TGRO in a new well in Black Hawk's Cowley County lease, TGRO will earn a 40% working interest in the # 1 Baker well, BHWX will receive a 50% interest in the new well and TGRO will have the right to participate in the 9 well rework program at the Cowley Prospect. BHWX will receive a 20% interest in any other new well TGRO drills on Black Hawk's current or future Cowley County, Kansas leases and has the option to invest in each additional new well drilled by TGRO on a prorated basis up to an additional 30%.
In addition to the acquisition, Black Hawk Exploration entered into an agreement with Tiger O&G. In the agreement BHWX purchased oil and gas leases within Cowley County (the "Prospect Area") and Tiger agreed to operate and participate in the development and exploration of additional oil and gas leases on behalf of BHWX.
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