Nutek Signs Letter of Intent to Acquire Oil Company
HUNTINGTON BEACH, Calif.--(BUSINESS WIRE)--Dec. 2, 1999--Nutek Inc. (OTC BB: NUTK - news) a diversified holding company Thursday announced it has signed a letter of intent to acquire the Clipper Operating Co. through a newly established subsidiary Nutek Oil Inc.
The Clipper Operating Co. has successfully been managing and operating oil wells belonging to Vac-U-Lift Production Co., a subsidiary of Nutek. Nutek Oil, will purchase all fixed assets valued at approximately $1.4 million, as well as, all leases, farm-outs and mineral interests of Clipper Operating Co.
Nutek Oil, will acquire a 100 percent working interest (WI) in all property held by Clipper Operating Co. in the Big Foot and Koyote fields of Frio and Atascosa Counties, Texas.
William G. Ellis, B.S., M.A., a registered independent geologist in both Texas and California and consultant to major oil companies has more than 39 years experience in the field of Petroleum Geology, was retained to determine the oil reserves on the properties and concluded his report by stating, "It is estimated that there are 90 million barrels in place, at a 12% recovery factor 10.8 million barrels are recoverable on the Clipper Properties." At current prices these reserves are worth $270 million.
"This is a major development for Nutek, as we will be adding 5,000 acres with 94 existing wells. We are expecting significant revenues from this operation within the next nine months, and have formulated an initial 10 year plan to start recovering these reserves," stated Murray Conradie, Nutek's CEO.
P.R. Maupin, president of Clipper Operating Co., who will head Nutek's Oil operations stated, "We will initiate an infield drilling program that should yield a discounted 'payout' of each new well in under two years. These reserves will be recovered in stages starting with the drilling of 20 new wells over the next 18 months."
"These are extremely exciting times for Nutek as we are moving into the New Year with all our subsidiaries positioned to generate substantial revenues," stated Conradie.
Safe Harbor Forward-Looking Statements:
Except for historical information contained herein, the statements in this release are forward-looking statements that are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the company's actual results in future periods to differ materially from forecasted results. These risks and uncertainties include, among other things, volatility of prices, product demand, market competition, risks inherent in the company's international operations.
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Contact:
Nutek Inc., Huntington Beach
Murray Conradie, 714/799-7266
Fax: 714/799-5466
E-mail: investors@nutk.com
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