The acquisition is expected to close within a few weeks after Omda receives clear title opinion and reserve engineering evaluations of future recoverable oil and gas. After closing, it is Omda's intention to fully exploit a " horizontal" drilling program with three wells initially and upon success, up to an additional six wells. S & H will be both the operator and drilling contractor for the program. Horizontally drilled wells, also targeting the Fredericksburg zone, in nearby leases have proven to be the key to more complete drainage of this " good porosity but low permeability" sand. The initial three well program is expected to commence before year end using a combination of Company, Joint Venture and Partnership funds.
Adam Barnett, Chairman, stated, " It has now been approximately one year since I have taken over and begun the restructuring of Omda. Some highlights of what we have accomplished include: Significant reductions of the company's outstanding shares, recently reported second quarter 2004 revenues up over 1500% from second quarter 2003 yet still only producing from approximately 32% of our 355 currently owned wells, an extensive firming up of our balance sheet and a significant increase in stockholder's equity." Barnett went on to say, "I now feel it is time to take the company to a new level. This S & H transaction not only gives Omda exposure to a significant oil and gas play in a hot area but also to a seasoned oil and gas veteran like Harold Smith, CEO of S & H. We see Mr Smith's value not only for this play but as an advisor for our existing wells as well as access to future plays."
Harold Smith, CEO of S & H said, " I am confident that this LOI will culminate with a completed transaction that will just be the first of many exciting future opportunities shared by Omda and S & H." Smith went on to say, " In the 22 years that S & H has been in existence, we feel we have a very good handle on the pulse of the Oil & Gas Industry. Due to expanding worldwide demand for oil and gas as shown by record well head prices, the future in our industry looks very promising. With Omda's core well ownership in Texas and Louisiana along with other prospects and expertise that S & H can provide, a bright future for Omda should be ahead".
Most Popular Articles