Powder River Purchases Interest in Drilling Company
Tuesday November 13, 7:00 am ET
CALGARY, ALBERTA--(MARKET WIRE)--Nov 13, 2007 -- Powder River Basin Gas Corp. (OTC BB:PRVB.OB - News), a revenue generating producer, acquirer and marketer of crude oil and natural gas properties, today announced it has purchased a 50% interest in Texoma Oilfield Services Inc. Texoma is a full oilfield service company which can complete all phases of drilling and well completion.
Equipment includes three drilling rigs and three pulling units (service rigs) as well as six full time service crews. It also includes dozers, backhoes, trenchers, rock saws, winch trucks, transport trucks, welders, and several service trucks as well as several acres of oilfield supplies.
Powder River will be taking over the administration aspects of Texoma and will have full and exclusive use of all the drilling and completion facilities. While the closing date is officially scheduled for November 30, 2007, the transition will start immediately, and equipment will be moving to Powder River projects the week of November 20th, 2007. As well as providing full well service, the agreement will provide project management while production development is underway and new wells are brought into the production stream. It will also give Powder River the flexibility and mobility to move service equipment to any of the projects as required. This will significantly reduce lost production days. As well, completion costs have also been estimated to reduce by approximately 25%.
As Powder River has a very aggressive well completion program scheduled for the next few years, this will eliminate wait time and allow the Company to complete wells more efficiently and on schedule.
A proposed new well completion schedule will be published in the next 30 days. Purchase price for the interest is $2,500,000 payable by $500,000 cash over 15 months and two million shares of Powder River at a value of $1.00 each for a total of $2,000,000. The agreement also provides a warrant for two million additional shares of Powder River at $0.25 per share of restricted stock.
"We are thrilled about this purchase, as it allows Powder River to complete programs underway and greatly increase cash flow for the Company, working interest investors, and shareholders. This also provides an additional development level of management, which is needed as Powder River continues to grow. I am excited to add this additional aspect to Powder River's operations, and look forward to more positive growth in the future," stated Powder River Basin Gas Corp. CEO Brian Fox.
Powder River Basin Gas Corp. is active in production, acquisition, and marketing of crude oil and natural gas properties. |
