WellStar Energy Corp. Announces it has Completed McTaggart SK Acquisition
CALGARY, AB / ACCESSWIRE / December 21, 2015 / WELLSTAR ENERGY CORP. (TSXV: WSE) ("WellStar", or the "Company") announced today that it has completed its previously announced asset acquisition to acquire a partner's (the "Vendor") interest in the Company's McTaggart, Saskatchewan oil project, plus additional lands and 2D seismic data.
A right of first refusal was enacted by a third party causing the acquired interest to drop to 32.82% from the previously announced 39.29% (see news release dated November 30, 2015). Before adjustments, the purchase price for the acquisition reflecting the new acquired interest was $75,998.
WellStar's President & CEO Andrew H. Rees stated, "The Company's board of directors has given management the mandate to seek out high-quality accretive acquisitions in the context of the current low oil price environment. We are very pleased to have been able to complete this acquisition and will continue working on a number of the opportunities currently under review."
The acquisition interests at the McTaggart project include two oil wells and facilities which include a salt water disposal well, a 5,000 barrel oil storage battery and a fresh water source well.
In September 2015, over $15,000 of monthly salt water disposal revenue was received net to the Vendor's working interest. The Company expects to receive similar amounts in the forthcoming months.
In September 2015 the 5B9-6 oil well averaged 2.9 m3/d of oil production (or 18.2 bopd). The 32.82% working interest being acquired from Vendor represents approximately 6 bopd. The well is currently undergoing maintenance while management evaluates and budgets for the installation of an ESP (Electronic Submersible Pump) which would significantly increase production volumes. The change in oil production would be dependent on the water cut.
The Company's recent recompletion in the 1B9-6 well is the second well in the acquisition package. The Vendor did not participate in the recompletion and has therefore been in penalty. After penalty payout, the Company will keep its acquired interest which would have otherwise been earned by the vendor.
As part of this acquisition the Company has acquired a licensed copy of the Vendor's interests in four 2-D seismic lines in the McTaggart area. This 2D seismic data will aid in the development of future opportunities in the McTaggart area.
WellStar has acquired a 25% mineral interest from the Vendor in two Freehold leases. These lands directly offset the Company's McTaggart property.
For further information please contact Andrew H. Rees at (403) 919-7900.
ON BEHALF OF THE BOARD
(signed) "Andrew H. Rees"
Andrew H. Rees
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Except for historical information contained herein, this news release contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially. Except as required pursuant to applicable securities laws, the Company will not update these forward-looking statements to reflect events or circumstances after the date hereof. More detailed information about potential factors that could affect financial results is included in the documents filed from time to time with the Canadian securities regulatory authorities by the Company.
THE FORWARD-LOOKING STATEMENTS CONTAINED IN THIS PRESS RELEASE PRESENT THE EXPECTATIONS OF THE COMAPNY AS OF THE DATE HEREOF AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON FORWARD-LOOKING STATEMENTS.
SOURCE: WellStar Energy Corp.
Source: Accesswire IA
(December 21, 2015 - 1:50 PM EST)
News by QuoteMedia