Primary Petroleum has agreed to move forward in executing a non-binding Letter of Intent ("LOI") to finalize a Farmout and Joint Operating Agreement (the "Agreement") with a major U.S. based Industry Partner on its 291,000 net acres under lease and option in the Southern Alberta Basin Bakken Fairway of NW Montana.
The completion of the transaction is subject to title and environmental due diligence and final documentation. It is expected to close on or before October 3rd 2011, when specific details of the formal agreement will be disclosed. Primary's current 3D Seismic and vertical drilling program will be ongoing during the due diligence and final documentation negotiation period.
"Primary looks forward to completing this transaction and moving forward with a strong Industry Partner to delineate and prove up our acreage position in the Southern Alberta Bakken Basin in NW Montana," states Mike Marrandino, President & CEO. "The Basin continues to be de-risked by Industry on both sides of the border and Primary is looking forward to the potential of confirming economic hydrocarbons over our lands. The next couple of years will be very exciting for the Company once this transaction is completed as it will enable Primary to fulfill its business objectives of evaluating its acreage with the added technical expertise and financial strength of a strong joint venture partner."
Current Pondera-Teton Work Program
Primary also advised that its current 3D Seismic program is underway on the Dupuyer Creek prospect. It is anticipated that both the Dupuyer Creek and Marias River seismic programs will be completed by the end of August. The seismic crew will then move south to continue with our Deep Creek East and Eureka Lake programs. To-date, the Company has identified three vertical drilling locations on its existing 3D Seismic that it completed in 2008 and is underway with the well site permitting process.
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