Eagle Oil Holding announced the execution of a Farmout Agreement with Questus.
Pursuant to the Agreement, Questus will provide the funding and other resources necessary to recondition and restart up to 173 wells at the Company's East Texas field, including the previously announced farmout agreements that totaled up to 20 wells, the Questus Agreement represents the completion of the Company's strategy to outsource the reconditioning of its oil resources. The Agreement is subject to an initial payment being made by Questus by June 22, 2011. The parties expect work on the wells to commence shortly thereafter. Questus will also complete the compliance requirements of the Texas Rail Road Commission.
Questus will provide the necessary capital and resources to restore the pumping operations with no additional capital investment by the Company in exchange for a share oil the revenue generated by the wells.
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