Nostra Terra, as part of their continuing plan to take larger working interests (WI) in prolific US oil fields, has entered into an agreement with Pathfinder Development Capital LLC ("Pathfinder") to acquire a 30% WI in the Bale Creek prospect, located in northern Oklahoma.
Highlights of the Bale Creek prospect include:
The Area of Mutual Interest (AMI) covers a contiguous area of over 3,500 acres. It is located in a very prolific oil system, proven to produce from multiple, stacked-pay reservoirs.
The project development plan consists of two phases. The first step in Phase I calls for the acquisition and interpretation of proprietary 2D and 3D seismic. Based on the tightly-controlled interpretation, a pilot hole will be drilled and logged to determine the most promising of all the potential productive zones. The next step will be to drill 3 horizontal wells into that zone, along with all production and transmission facilities to support the project. Leasing for drilling and seismic permitting in Phase I are already underway. The total estimated cost of pre-drilling activities is US $672,700, of which Nostra Terra's estimated portion is US $201,810.
The drilling budget is being finalized with drilling of the first well being planned for beginning of 4Q 2011.
Phase II will include up to four additional horizontal wells plus the additional production facilities. This phase will entail further leasing and seismic permitting within the existing AMI, prior to drilling. The final determination to move into Phase II will be made in H1 2012.
Based in Norman, Oklahoma, Pathfinder Exploration Company, LLC is a multi-disciplined geotechnical company specializing in finding new oil from old fields within the US. Combining the most advanced technology with cost-effectiveness, Pathfinder is able to identify, delineate and grade additional prospects where there are known oil and gas reserves and frequently multiple pay zones, thereby reducing risk and increasing upside potential. Pathfinder acted as operator on behalf of Shell in the Fayetteville Shale play in Arkansas, which has become an important source of natural gas through the use of horizontal drilling.
Matt Lofgran, Chief Executive Officer of Nostra Terra, commented, "Nostra Terra is delighted to have entered into this agreement with Pathfinder, which marks a strong step into Oklahoma. This agreement is in line with our stated strategy to step up the pace of our growth by acquiring a diverse pipeline of assets in established oil and gas plays - including larger interests, where we can generate added value and strong, sustainable cash flow through disciplined cost control and the use of advanced technology. Pathfinder has aligned interests and we look forward to furthering opportunities with them."
Pathfinder Development, Alden McCall, Chief Operating Officer added, "It is a genuine pleasure to be engaged with Pathfinder on this project from the purely technical point of view as well. It is a key to our growth plan to utilize leading edge technology (3D seismic, sophisticated log suites, 3D-steered horizontal well bores and modern multi-stage completions) to produce oil from compartmentalized reservoirs that have been grossly under-produced. Pathfinder Exploration has created an impressive screening and evaluation process to locate numerous prospective reservoirs in which to apply these technologies."
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