Dejour to Purchase Proved Producing NatGas Reserves in Texas
Dejour Enterprises has signed a letter of intent to purchase certain proven producing and undeveloped reserves, associated land (approximately 2100 acres), data and wells located in Liberty County, Texas, effective August 1, 2007 for the sum of $US 3,500,000 cash with minor gas balancing adjustments.
The purchase includes 4 wells; 2 wells currently producing gas with associated condensate in excess of 12.0 million cubic feet of natural gas combined, one new well currently being placed on line with similar pressures and standing cased well; all drilled to approximately 12000 feet. Working interests range from 11.38% to 15.9%. LaRoche Consultants of Dallas Texas, on behalf of Dejour Energy (USA) Inc., a wholly owned subsidiary of Dejour, are providing independent engineering reports assigning NI 51-101 compliant gross proven reserves associated with this purchase of 9.3 billion cubic feet of natural gas (BCF) and 130,000 barrels of condensate based on the NYMEX strip case. Production from this field is expected to be enhanced when the new well is placed on stream. Dejour anticipates additional well(s) to be drilled in the future.
Chairman and CEO Robert L. Hodgkinson states, "This asset purchase has many advantages, not the least of which includes a proven production base that we estimate should provide an accelerated payback of invested capital between 12 and 18 months and upside development potential in a stalwart high pressure reservoir. The net revenue stream from this purchase is expected to exceed all company non-capex overhead expenditures for the foreseeable future. Additionally these reserves, combined with existing reserves, oil & gas assets, working capital and balance sheet strength should provide the basis to make a successful submission to upgrade the listing of company shares from the TSX Venture Exchange to the TSX."
Dejour expects to close this purchase on or before the September 14, 2007 assuming no due diligence issues. This purchase will be funded from cash on hand. Upon closing, Mr. Michael H. Heisey, Petroleum Engineer, has accepted an invitation to join Dejour's Board of Advisors and will be granted 50,000 option.
R.Marc Bustin, Ph.D., P.Geol., FRSC, is the qualified person for this news release.
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