Mooncor has completed the assembly of its land package in Southwest Ontario by purchasing 18,737 acres (18,592 net) within the Kent and Lambton Counties of Southwest Ontario from a large multi-national oil and gas company for $100,000. The leases acquired are immediately adjacent to Mooncor's original 3,833 acre land position. The leases acquired were prepaid to end of term, the majority of which expiring in late 2011.
Mooncor has identified six Silurian pinnacle drilling locations on its original 3,833 acre land position based on geological mapping and gravity work. The acquired leases also provide Mooncor with additional Silurian pinnacle prospects as well as several potential oil offset locations. The primary conventional plays for lands within the Kent and Lambton County area are the Ordovician, Silurian - Salina and Devonian. The unconventional plays include the Kettle Point Formation (Antrim style shale gas zones) and the Collingwood/Blue Mountain Formation (Utica shale gas zones).
The Ontario government has recently completed a high resolution aeromag survey over lands that cover the recently purchased land position as well as Mooncor's original land position. The aeromag survey is now available to exploration companies. A review of this survey over the newly acquired lands is underway.
Mooncor believes that Ontario is an attractive exploration environment due to high producer netbacks, low royalties and leasing costs, access to exploration data, low transportation costs, easy road access and numerous untested prospects. In addition, Mooncor believes Ontario will benefit tremendously by application of advanced seismic techniques and the implementation of improved drilling, completion and logging tools.
Mooncor is currently in negotiations with several entities in connection with a proposed spinoff of its Southwest Ontario assets into another public company. Further details will be communicated in due course, as appropriate.
Divesting of Crossfield, Alberta
Mooncor has also divested its interests in the Crossfield, Alberta property to a private oil and gas company. The effective date of the transaction is January 7, 2010. Net proceeds from the sale are $146,667.
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