Sun River Acquires Powder River Basin Acreage
Sun River Energy, Inc. has signed an asset purchase agreement with Nova Leasing, LLC to acquire 13,500 acres of leases in Wyoming's Powder River Basin for the purpose of oil, gas and mineral exploration.
The purchase price of the property totaled $6.6 million in the form of a secured promissory note bearing interest at 7.5% paid over 2 years. Additionally, 880,000 restricted common shares of Sun River, Inc. common stock were issued. The transaction closed on November 20, 2006.
Sun River plans to conduct a 3-D seismic survey of this property beginning next year. The survey will encompass approximately 20,000 acres. A drilling program is planned to begin in the first quarter of 2007 on Sun River's New Mexico acreage for coal bed methane and in Wyoming on its Powder River Project in early 2008.
The Powder River Basin region is a prolific oil and gas producing area with a long history of production. In the vicinity of the company's Powder River Prospect, 6 prominent fields in the area produced over 700 million barrels of oil and over 1.4 TCF (trillion cubic feet) of gas from 8 different formations.
Historic production has been from depths of 4000 to 16,000 feet and management believes that based upon its review of multiple 2-D seismic lines that 3-D seismic will define the most promising drilling prospects.
Sun River Energy, Inc., a development stage company, is engaged in the exploration and development of oil and gas properties in the United States. Sun River Energy's objective is to seek out and develop opportunities in the oil and natural gas sectors that represent a low-risk opportunity. As well, Sun River aims to define larger projects that can be developed with joint venture partners. Sun River is confident that these viable opportunities exist in a sector that holds long-term fundamental growth opportunities.