AGR Tools Inc's wholly owned subsidiary AGR Energy Holding Inc. (or "AGR Energy) has signed a memorandum of understanding to acquire a two thousand twenty six (2,026) acre oil and gas lease in, Corsicana, Texas from BNMW Resources, LLC (or the "Vendor").
Under the terms of the agreement, the Company shall pay four hundred fifty thousand dollars ($450,000) for a seventy seven percent (77%) net revenue interest in the potential production from the four (4) parcels, two thousand twenty six (2,026) acre property collectively called the "Smackover Lease."
Management believes the Smackover lease to be a strong acquisition as it lies on strike with other companies producing oil in the area-- both along the same fault. Based on company prepared as well as independently prepared reports, the Company believes that per the report, Smackover may contain significant oil and gas reserves which may yield up to two million barrels of oil (2,000,000 BO) and may yield up to thirty eight billion cubic feet (38,000,000,000 Ft3) of natural gas, and create the potential for a seven to eight well drilling program which would require a capital budget of roughly fifteen million four hundred thousand dollars ($15,400,000).
The consummating of the transaction will be contingent on the acquisition of a title opinion acceptable to legal counsel and the negotiation of the final acquisition documents.
Mr. Vern Wilson, CEO of AGR commented: "In conjunction with the lease owners, I have performed significant amounts of due diligence on the Smackover lease over the past several years. I have surveyed the first drilling site and have visited the other drill sites -- I am very familiar with the property as well as the local geology.
"Assuming we utilize our non-dilutive financing agreement with Qeteras, or a similar instrument, the company may not need to issue any stock to acquire or develop this property, a strategy we seek to use."
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