ETE's financial outlay for the tracts will be approximately US$ 379,621.00 being 5% of the bids, plus sales tax. A prominent, well established company with experience in the Gulf of Mexico will serve as operator. Each tract consists of 720 acres and is located approximately 10 miles offshore State of Texas in 40 feet of water.
The interest was acquired via a Memorandum of Understanding (MOU) executed between ENTEK and Cities Energy, LLC (CITIES) based in Houston, Texas, USA.
Overriding royalties include State Revenue of 20% if a well is drilled in the first 2 years, and other burdens. Additional development and exploratory drilling is expected within the next 12 months.
This activity further demonstrates ETE's intentions to seek participation in what management considers low risk oil and gas targets in the shallow waters of the Gulf of Mexico ("GOM") and follows from the recently announced farmin to GOM properties Vioska Knoll 79,Vermillion 317 and High Island 307.
The company is rapidly assembling a portfolio of interests in GOM acreage with exciting low risk exploration targets for drilling in 2006 and 2007.
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