Fox Petroleum Joins JV
Fox Petroleum has signed an agreement entering into a 22.5% joint venture interest in the Multi-Pay Gas Well called the Spears Gas Unit 2, Well #1 in the Gomez Field, Pecos County, Texas. In consideration for the 22.5% joint venture interest in the well, Fox Petroleum is paying US$500,000 to acquire 22.5% of the Trius 72.75% working interest in the Spears Gas Unit 2, Well #1.
Fox Petroleum has signed the agreement with Trius Energy LLC to partner with them, Lakehills Production, Inc and Hunt Oil among others, on the reopening of the Spears Gas Unit 2, Well #1 in the Gomez Field of Pecos County Texas, with an estimated spud of November 15th, 2007. The Spears Gas Unit neighbors a number of well-known producers of Oil and Gas including Chesapeake Energy, Chevron and Cimarex Energy.
The Spears Gas Unit 2, Well #1 has produced over 23BCF of natural gas, which equates to US$149,500,000 at current market prices (Reference – Trius Energy's Prospectus, September 7, 2007). According to evaluation by Trius Energy LLC, in association with Stratco Operating Co. MC, the Spears Gas Well could potentially produce 3,000 MCFGPD or greater, which is supported by data review of the Composite Borehole Compensated Sonic Log, Gamma Ray & Sidewall Neutron Porosity Log, extensive reservoir analysis and recent field data.
Richard Moore, CEO of Fox Petroleum states, "We are excited to be participating in this joint venture with US renowned partners who include Trius Energy and Hunt Oil. The Spears Gas 2 Unit has an impressive history of production, and is part of a well-known and well-understood gas-producing trend that has experienced a very successful reactivation program over the last few years. We anticipate re-entry work to commence within this quarter, and look forward to the possibility of our first production well."
Alex Craven, Vice President, Finance said, "We see this as an excellent opportunity for Fox Petroleum to generate short term revenue, commence production and hopefully book reserves. Having the revenue potential to cover the investment in a matter of months makes this is a very significant venture for us. We hope to achieve the success of both our partners and neighboring oil and gas production companies."
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