Ameriwest Energy Corp. has entered into an Exclusive Option to Purchase with Hot Springs Resources, Ltd., to acquire not less than a working interest of 95% at a 79.9% net revenue interest within the 1,920 acre Burke Ranch Unit, plus a working interest of 100% at an 82% net revenue interest in the 6, 879 acre adjacent leases (outside the Burke Ranch Unit) which combined are the Area of Mutual Interest ("AMI") located in Natrona County, Wyoming.
The Burke Ranch field consists of a total AMI of roughly 8,739 acres situated approximately 25 miles North of Casper, Wyoming located in the Powder River Basin. Discovered in 1953, the field has been estimated by the Wyoming Oil and Gas Conservation Commission at 13 million barrels of original oil in-place and has produced approximately 6.5 MBO using primary and secondary recovery methods.
Reservoir Engineers, NITEC LLC, of Denver, Colorado, studied the tertiary recovery potential of the Burke Ranch Field via CO2 injection and estimated an additional 2.4 MBO as recoverable. Recent geologic studies including analogous fields within the area have indicated possible and probable recoverable reserves within the Muddy, Mowry/Niobrara, Frontier and Tensleep formations. These include the Twenty Mile Hill Field (1.5 MBO produced from Frontier Formation) and the Lost Dome Field (1 MBO produced from Tensleep). The producing limits of the Burke Ranch Field have not been fully established.
As part of the agreement with Hot Springs Resources, Ameriwest plans to initiate a workover program for the purposes of evaluating and re-establishing water flood production in the Burke Ranch Unit within 30 days after Closing.
Full details regarding the agreement will be submitted shortly to the Securities and Exchange Commission ("SEC") as part of the Company's Form 8-K filing regulatory disclosure.
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