Cadence Resources Inks LOI to Acquire Antrim Shale Project
Cadence Resources has signed a Letter of Intent to acquire all leases, wells, facilities and production associated with two producing projects in northern Michigan. This adds approximately 5,000 acres of mineral rights, 11 producing wells, and over 500 Mcf of daily production to the Company's portfolio. Management also estimates proven reserves in excess of 10 Bcf associated with the acquisition. Due diligence is underway and expected to be complete for an agreement effective date of June 1, 2006.
Thomas Tucker, Vice President of Operations commented, ``This acquisition fits nicely with our Antrim Shale production portfolio. Operationally, we immediately add reserves and undeveloped acreage. Financially, we add revenues from flowing gas. The best part of this deal, however, is two-fold. First, drilling permits are already in hand or in process. Second, the pipeline and processing infrastructure, which includes over 5 miles of sales pipeline, is already complete.''
In addition to this acquisition, two new project areas in the Antrim Shale were put into production this month. The Black Bear Central and Arrowhead Antrim Units went on-line May 9th and May 11th, respectively, and are currently in the dewatering phase. Between the 2 projects, 12 wells are producing and 22 will be put into production in the near future. An additional 8,000 acres are left to be developed. Initial production results are encouraging and reserves can be reclassified as proven from probable.
With the above-mentioned acquisition and the addition of the Black Bear and Arrowhead production, the Company expects to easily hit the mid-year projection of 100 Bcf in proven reserves.
Cadence Resources is an independent energy company focused on unconventional natural gas exploration, acquisition, development and production with its main operations in the Michigan Antrim Shale and Indiana New Albany Shale.
- Cadence Resources Receives Approval for AMEX Listing and Name Change (May 23)
- Cadence Resources Inks LOI to Acquire Antrim Shale Project (May 17)
- Cadence Begins Production from Logansport Project (Oct 18)