X-Change Corporation announced through its subsidiary Cress Oil, Inc. that it has entered into a purchase and sale agreement with a private company to acquire more than 44,000 net mineral acres in the Bakken and Three Forks formation in the U.S. portion of the Williston Basin of Montana. The total purchase price is $30,800,000.00. The leases can be taken in separate blocks of 1,000 or more acres at the discretion of Cress Oil until the entire block of 44,000 acres is taken down.
Cress Oil agrees to drill a minimum of 2 to 4 wells every 12 months during the first 36 months. While there is more total oil available in the Bakken, a greater percentage can be recovered from the Three Forks formation, which is now considered a separate formation from the Bakken. The Three forks area is below the upper Bakken shale zone and opens up for new opportunities for resource plays. The Bakken shale continues to expand into areas like Three Forks causing total Bakken oil reserve estimates to go up.
"Our acreage position in the Bakken and Three Forks formation gives the company a big footprint for exploration and production," said Atul Trivedi, chief executive officer of Cress Oil, Inc. "Our average cost, after the closing, is relatively low at $700 per acre. The Three Forks is made up of sand and porous rock directly below North Dakota's portion of the Bakken formation, where oil-producing rock is sandwiched between layers of shale about 2 miles underground. There is expected to be 30-40 years of drilling in the Bakken Shale and Three Forks formation producing 6 to 24 billion barrels in that region altogether."
A U.S. Geological Survey estimated undiscovered volumes of 3.65 billion barrels of oil, 1.85 trillion cubic feet of associated/dissolved natural gas, and 148 million barrels of natural gas liquids in the Bakken Formation of the Williston Basin Province, Montana and North Dakota.
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