Small Cap Inks LOI to Purchase Xtreme Oil & Gas
Small Cap Strategies, Inc. has announced the execution of a Letter of Intent to acquire, in the next 30 days, the assets of Xtreme Oil & Gas, Inc., including five oil and gas properties representing approximately 2,400 acres in Texas and Oklahoma.
Also included in the transaction were the two licensed and bonded Operators owned by Xtreme which would permit the Company to control and manage operations of the wells now situated on the properties. The Company has previously announced its intent to shift its primary business focus to the oil and gas industry and this acquisition is a further step in that direction.
The properties being acquired include both existing wellbores that were acquired by Xtreme for redevelopment and approximately six wells currently producing approximately 75 barrels per day. The properties include more that 75 existing wellbores that can be redeveloped and returned to production. Many of the existing wells include multiple pay zones, some of which have not been previously exploited. The business model of Xtreme has been to acquire these older properties and apply modern recovery techniques and managed costs to maximize production at the lowest cost.
"We believe that the economics of the oil and gas industry justify shifting the focus of the Company to this industry and look forward to working with the folks at Xtreme," commented Bryce Knight, CEO of the Company.
"Working with a public company like Small Cap Strategies, Inc. will allow us to obtain the capital to exploit the properties that we have acquired over the past year and a half," added Will McAndrew, CEO of Xtreme who will, with board approval, take over management of the Company.