Harvest Natural Resources, Inc. announced it entered into an area of mutual interest (AMI) with a private company to explore and develop oil and natural gas along the Texas and Louisiana Upper Gulf Coast. The AMI, including state waters, stretches from Nueces County, Texas to Cameron Parish, Louisiana and includes approximately 40 counties. Harvest will fund the first $20 million of new lease acquisitions, G&G studies, seismic reprocessing and drilling costs. Harvest has a 55 percent operated interest within the AMI and will provide drilling, engineering and operational expertise. The private company has contributed two prospects, including the leases and proprietary 3-D data sets, and numerous leads generated over the last three decades of regional geological focus.
The AMI was developed to explore for natural gas including the deeper Frio, Vicksburg and Yegua plays using the private company's regional knowledge and ongoing prospect generation capability followed by extensive prospect review by Harvest and Fusion Geophysical L.L.C.'s technical geophysical staff.
Harvest President and Chief executive Officer, James A. Edmiston, said, "The identified prospects in the AMI provide Harvest with exposure to near-term exploration drilling and a chain of follow -- on potential opportunities for the exploration of natural gas including deeper plays in the U.S. Gulf Coast. The program exposes Harvest to significant near-term value potential and diversification due to the strong U.S. natural gas market and short cycle time from discovery to production, relative to our international operations. The first prospect is located in Calcasieu Parish, Louisiana where an exploration well will be drilled beginning early in the third quarter of this year. The second prospect area is in a transition zone where multiple leads with significant resource potential have been identified."
Edmiston continued, "Our private company partners have a track record that is second to none in the Texas Gulf Coast and East Texas area. Their geological team includes John Amoruso, Denny Bartell and Larry Bartell. This team's most recent discovery is the giant Amoruso field (Deep Bossier, East Texas), discovered in 2005, which is viewed by many in the industry as one of the most significant onshore natural gas discoveries in the continental United States in the past decade or more. We at Harvest are extremely pleased to be working alongside such an accomplished and seasoned team of explorers."
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