Norex announced that its personnel and independent engineering consultants have commenced a formal due diligence process on two California natural gas projects.
The ongoing review of engineering and geological data provided to the Company has been extremely positive to-date. Engineers have reviewed the existing 2D and 3D seismic data as well as analog well production data with current geological reservoir mapping. Based on the preliminary conclusions of the due diligence team, the Company now feels that an acquisition of the gas plays will be viable within the next 30 days.
At that time, Norex will endeavor to acquire a majority working interest in these projects which show a combined potential to contain up to 50 BCF gas. The Company will announce further details of the projects upon completion of the review process and once a purchase and sale agreement with the vendors is finalized. Norex believes that the project, if proven to be commercially viable, may represent a venture with an in-situ value of greater than $50 million in contained gas to a majority working interest partner.
Norex further believes that the addition of these projects significantly augments the recently announced Alberta gas acquisition and thereby dramatically increases both the overall strength of the Company's infrastructural health as well as its total potential gas reserves as the Company moves rapidly towards multiple production scenarios.
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