CAVU Resources announced that the CAVU 1 recently put into production exceeded the initial estimates. CAVU has also re-launched its 5 million dollar private placement to replace funds expended for the recent upgrades of the Chisholm lease, the Montana leases, wind energy projects and the completion of the FILO 1, CAVU's permitted 50,000 barrel a day saltwater disposal well (FILO 1).
CAVU recently had employees monitoring the flow rates of the Chisholm B 2, Nabors 1 and the CAVU 1 24 hours a days since they were put back into production. The Chisholm lease is currently producing about 3,000 barrels a day of fluid. The existing storage facilities and active saltwater well are at their current production capacity.
The recently completed upgrades allow for rapid expansion of the storage facilities. Once the planned chemical treatment programs are initiated and storage facilities are expanded, oil production could be increased. The $5 million dollar private placement originally launched last year has been restructured to sell ownership interest in the current Chisholm Lease, FILO 1, the Montana and Wind Energy projects. The proceeds are also designated to pay for the work that was financed and the original funds borrowed to purchase the properties.
With the completion of the FILO 1, CAVU will be able to increase production on all of its Chisholm wells, as well as the targeted recompletions and new wells. As reported earlier the company has 12,000 barrels a day of saltwater disposal usage committed for the FILO 1 well.
"The success of the Chisholm Lease project and the future potential of the FILO 1, Montana and wind energy projects should produce positive returns for the company by the end of 2011. We believe that by reducing the long and short term debt along raising new project capital with minimal dilution should increase investor interest in CAVU's stock," stated William Robinson.
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